22 TAC §309.10
The Texas State Board of Pharmacy proposes new §309.10,
regarding refills of prescription drug orders. The proposed rule, if adopted,
will set forth the statutory requirements of section 40(m) of the Texas Pharmacy
Act and will also establish a list of narrow therapeutic index drugs subject
to the provisions of section 40(m) of the Texas Pharmacy Act.
The proposed §309.10 is substantially similar to §309.3(d), which
also addresses refills of prescription drug orders. The Texas State Board
of Pharmacy proposed amendments to §309.3 and published notice of the
proposed rule in the July 3, 1998, issue of the
Texas Register
(23 TexReg 6829). Subsequent to the Board business meeting
in August 1998, at which the Texas State Board of Pharmacy voted to adopt
the proposed amendments to §309.3, a lawsuit regarding the amendments
to §309.3 was filed against the Texas State Board of Pharmacy. On December
16, 1998, following arguments by legal counsel for the parties, the trial
court held that the Texas State Board of Pharmacy failed to adopt the amendments
to §309.3 rule in compliance with the Administrative Procedure Act and
that the rule was null and void and of no force or effect. On January 13,
1999, the trial court entered the Final Judgment. At the Board business meeting
on February 2, 1999, the Texas State Board of Pharmacy voted to pursue an
appeal of the trial court judgment regarding the amendments to §309.3.
The Texas State Board of Pharmacy also voted to propose a rule as mandated
by section 40(m) of the Texas Pharmacy Act.
Accordingly, the current provision of 22 TAC §309.3(d) has been held
invalid by a trial court and is the subject of a pending appeal to an appellate
court by the Texas State Board of Pharmacy. The Texas State Board of Pharmacy,
however, proposes new §309.10, which fulfills the requirements of section
40(m) of the Texas Pharmacy Act with respect to refills of prescription drug
orders involving narrow therapeutic index drugs.
The proposed new rule incorporates the recommendations of a Task Force
composed of representatives from the Texas State Board of Pharmacy, Texas
State Board of Medical Examiners, pharmacy and medical associations, and generic
and brand-name manufacturers. The proposed new rule outlines the conditions
under which the substitution of a narrow therapeutic index drug may occur
on the refill of a prescription. The proposed new rule, as specified in the
legislation, requires a pharmacist to notify the patient and the prescribing
physician if the pharmacist refills a prescription for a narrow therapeutic
index drug with a generically equivalent product different from the product
used on the previous refill. The proposed new rule also establishes a list
of narrow therapeutic index drugs, which are subject to the provisions of
section 40(m) of the Texas Pharmacy Act. Narrow therapeutic index drugs are
drugs in which small variances in the blood levels of the drug can change
the effectiveness or toxicity of the drug. The list in the proposed new rule
contains those drugs that health-care practitioners generally monitor closely
through lab tests to ensure that the drug remains at the appropriate blood
level for the individual patient. The Texas State Board of Medical Examiners
has reviewed the list recommended by the task force and agrees that the list
of drugs in the proposed rule is appropriate for the purpose of section 40(m)
of the Texas Pharmacy Act.
Gay Dodson, R.Ph., Executive Director/Secretary, has determined that, for
the first five-year period the rule is in effect, there will be possible fiscal
implications for the state as a result of enforcing or administering the rule.
There are no anticipated fiscal implications for local government.
The fiscal implications for the state are based on the cost of an enforcement
action by the Texas State Board of Pharmacy. Fiscal implications for the agency
are anticipated to be minimal because the enforcement and administration of
the proposed rule can be adequately managed with existing resources. In fiscal
year 1997, as stated in the agency's Annual Report, the agency resolved 1,697
complaints and, of those complaints, only four complaints alleged violations
of the laws and rules regarding substitution of narrow therapeutic index drugs.
The agency cannot accurately project whether the adoption of the proposed
rule will increase the number of complaints received by the agency or the
number of disciplinary cases that may proceed to formal hearing. However,
by using FY97 agency data, the agency can estimate the possible costs to the
state for an agency enforcement action. For example, if the agency investigated
and initiated disciplinary action on the four complaints involving narrow
therapeutic index drugs that were received by the agency in FY97, then the
cost to the agency as a result of enforcing or administering the rule is approximately
$1,745.56. This estimated amount is based on the cost of a resolved jurisdictional
complaint ($436.39) times the number of complaints (4). The cost of a resolved
jurisdictional complaint is based on the total funds and personnel costs expended
for processing and investigating a complaint, as well as the funds and personnel
costs required to adjudicate a licensee who is the subject of a complaint.
The funds expended include all direct costs associated with complaint resolution.
These direct costs are identified in the agency's internal operating budget
and, where applicable, include percent of salaries according to estimated
time, rent, supplies, travel, postage, subpoena and witness expenses, cost
of court reporter for hearings, charges by the State Office of Administrative
Hearings, and other operating expenses directly related to the agency's enforcement
function only. Indirect costs are not included in the calculation of the cost
of a resolved jurisdictional complaint. Based on this calculation and assuming
that complaints remain constant, the cost to the Texas State Board of Pharmacy
for the next five years would be as follows: FY2000--$1,745.56; FY2001--$1,745.56;
FY2002--$1,745.56; FY2003--$1,745.56; and FY2004--$1,745.56.
In addition, there may be fiscal implications to the state Medicaid program.
For each Medicaid prescription dispensed by a pharmacy, the state Medicaid
program pays the pharmacy a price based on a set formula. The formula includes
a cost for the drug plus a dispensing fee. A pharmacist is prohibited from
charging the state Medicaid program more for a prescription that calls for
a narrow therapeutic index drug despite any additional time spent by the pharmacist
in dispensing the prescription. Therefore, increased costs to the state Medicaid
program may occur if a pharmacist refuses to substitute a lower-priced generic
prescription drug product when permitted to do so, and instead dispenses a
higher-priced brand name prescription drug product. In an effort to estimate
the possible cost to the state Medicaid program, the agency has assumed that
all pharmacists will refuse to substitute a lower-priced generic prescription
drug product when permitted to do so in all cases. By using this assumption,
the agency can estimate the highest possible increase in cost to the state
Medicaid program. In addition, the agency calculated its estimated cost to
the state Medicaid program on only six of the nine drugs on the list of narrow
therapeutic index drugs in the proposed rule. The three drugs not used in
the agency's calculation are digoxin, levothyroxine, and divalproex sodium.
These three drugs were not included because none of these drugs have a generic
equivalent in an oral dosage form that may be substituted under Texas laws
and rules. The six drugs used in the agency's calculation of costs to the
state Medicaid program are: phenytoin, warfarin, theophylline, carbamazepine,
lithium, and valproic acid. Given the factors described above and based on
information provided by the Texas Department of Health, Vendor Drug Program,
which administers the Texas Medicaid Program, the agency estimates that the
proposed new rule may result in increased costs to the state Medicaid program
in the estimated amount of approximately $4,567,820.74 per year. The chart,
in Figure: 22 TAC Chapter 309--Preamble, shows the costs of the individual
drugs and the calculation used. (Please note that this is the highest possible
costs and does not take into consideration possible reductions in costs as
a result of manufacturer rebates to the Vendor Drug Program nor possible reductions
in costs caused by the effect of the setting of Maximum Allowable Cost (MAC)
on some dosage forms to the six drugs by the Vendor Drug Program. A MAC price
on a drug indicates that the Vendor Drug Program has set a maximum cost that
will be paid for the drug regardless of the cost of the drug to the dispensing
pharmacy.)
Figure: 22 TAC Chapter 309--Preamble.
Based on the calculations and assumptions in Figure: 22 TAC Chapter 309--Preamble,
the estimated cost to the Texas Vendor Drug (Medicaid) Program for the next
five years would be: FY2000--$4,567,820.74; FY2001--$4,567,820.74; FY2002--$4,567,820.74;
FY2003--$4,567,820.74; and FY2004--$4,567,820.74.
Ms. Dodson also has determined that, for each year of the first five-year
period the rule will be in effect, the public benefit anticipated as a result
of enforcing the rule will be the establishment of a list of narrow therapeutic
index drugs subject to section 40(m) of the Texas Pharmacy Act. The notice
requirement in the proposed rule promotes good communication between the patient,
the prescribing practitioner, and the pharmacist, particularly with regard
to critical care medications that require frequent monitoring of performance.
Section 2006.002 of the Texas Government Code requires that a state agency,
before adopting a rule that would have an adverse economic effect on small
businesses, shall prepare a statement of the effect of the rule on small businesses,
defined in section 2006.001(1). The statement must include the following:
(1) an analysis of the cost of compliance with the rule for small businesses;
and (2) a comparison of the cost of compliance for small businesses with the
cost of compliance for the largest businesses affected by the rule, using
at least one of the following standards: (A) cost for each employee; (B) cost
for each hour of labor; (C) cost for each $100 of sales. The Texas Pharmacy
Act prohibits the agency access to pharmacy financial data. This lack of access
to financial data limits the agency's ability to identify and analyze estimated
costs to licensees. The costs/fiscal implications to a small business are
dependent on the number of prescriptions filled by the licensee, the costs
of the prescription drug dispensed by the licensee, and the costs assigned
to the amount of time that the licensee must allocate to notify the prescribing
practitioner that a product has been substituted for the prescribed product.
The following factors also affect the agency's ability to estimate costs to
small businesses: the number of prescriptions filled by a pharmacy may vary
on a daily basis, the number of prescriptions that may be subject to the proposed
rule may vary on a daily basis, and the prescription volume for licensed pharmacies
vary according to size, number of pharmacists and pharmacy employees, demographics,
and location in the state (rural versus urban pharmacy).
Given the limitations and variables that affect the agency's ability to
estimate the costs, the agency is unable to give an accurate assessment of
the costs. The agency does not have information with which to make a comparison
between the cost of compliance for a small business and the cost of compliance
for a large business affected by the rule based on costs per each employee,
per each hour of labor, or per $100 of sales. Because the proposed rule requires
a pharmacist to notify a patient and a prescribing practitioner of a substitution,
the cost to small and large businesses will be the cost of the pharmacist's
time that is necessary to make this notification. It is estimated that the
notification will require no more than two minutes of the pharmacist's time
per prescription. If the agency uses $26.51 as the average hourly salary for
a pharmacist (Drug Topics, April 7, 1997), the costs to businesses from compliance
with the rule will be approximately 88 cents per prescription. The agency
cannot accurately estimate the number of prescriptions that this proposed
rule will affect nor the costs to businesses because data is not available
on the number of prescriptions written for the drugs on the list on which
a prescribing practitioner has allowed substitution and on which a pharmacist
has substituted.
There are possible economic costs to pharmacists, who are the individuals
required to comply with the proposed rule. Pharmacists who are also owners
of pharmacies may be affected by the various factors outlined above that effect
the costs to large and small businesses. Because the agency cannot estimate
the number of prescriptions that the proposed rule will affect, the agency
is unable to give an accurate assessment of the fiscal implications to pharmacists.
A public hearing to receive oral comments on the rule will be held at 9:00
a.m. on Tuesday, May 4, 1999, in the Health Professions Council Board Room,
William P. Hobby State Office Building, Tower 2, Room 2-225, 333 Guadalupe,
Austin, Texas. Written comments on the proposal may be submitted to Gay Dodson,
R.Ph., Executive Director/Secretary, Texas State Board of Pharmacy, 333 Guadalupe
Street, Suite 3-600, Box 21, Austin, Texas, 78701-3942. Written comments will
be accepted through Friday, June 2, 1999.
The new section is proposed under Sections 4, 16(a), and 40(m)
of the Texas Pharmacy Act (Article 4542a-1, Texas Civil Statutes). The Board
interprets section 4 as authorizing the agency to adopt rules to protect the
public health, safety, and welfare through the effective control and regulation
of the practice of pharmacy. The Board interprets section 16(a) as authorizing
the agency to adopt rules for the proper administration and enforcement of
the Act. The Board interprets section 40(m) as directing the agency to consult
with the Board of Medical Examiners and by rule to establish a list of narrow
therapeutic index drugs.
The statutes affected by this rule: Texas Civil Statutes, Article 4542a-1.
§309.10.Refills of Narrow Therapeutic Index Drugs.
(a)
Original substitution instructions. Refills shall follow
the original substitution instructions unless otherwise indicated by the practitioner
or practitioner's agent.
(b)
Narrow therapeutic index drugs.
(1)
A prescription for a narrow therapeutic index drug on which
a physician has originally allowed generic substitution may be refilled only
by using the same drug product by the same manufacturer that the pharmacist
last dispensed under the prescription, unless otherwise agreed to by the prescribing
physician.
(2)
If a pharmacist does not have the same drug product
by the same manufacturer in stock to refill the prescription, the pharmacist
may dispense a drug product that is generically equivalent if the pharmacist
notifies:
(A)
the patient, at the time the prescription is dispensed,
that a substitution of the prescribed drug product has been made; and
(B)
the prescribing practitioner of the drug product substitution
by telephone, facsimile, or mail, at the earliest reasonable time, but not
later than 72 hours after dispensing the prescription.
(3)
For the purpose of this subsection, narrow therapeutic
index drugs shall be all oral dosage forms of the following:
(A)
digoxin
(B)
phenytoin
(C)
warfarin sodium
(D)
theophylline
(E)
levothyroxine
(F)
carbamazepine
(G)
valproic acid
(H)
lithium
(I)
divalproex sodium
(4)
The board, in consultation with the Board of
Medical Examiners, shall review the list of narrow therapeutic index drugs
subject to this subsection when deemed appropriate but at least every two
years.
This agency hereby certifies that the proposal has been
reviewed by legal counsel and found to be within the agency's legal authority
to adopt.
Filed with the Office of the Secretary of State, on
March 22, 1999.
TRD-9901698
Gay Dodson, R.Ph.
Executive Director/Secretary
Texas State Board of Pharmacy
Earliest possible date of adoption: May 2, 1999
For further information, please call: (512) 305-8028