Part 1.
DEPARTMENT OF STATE HEALTH SERVICES
Chapter 229.
FOOD AND DRUG
The Executive Commissioner of Health and Human Services Commission
on behalf of the Department of State Health Services (department) proposes
new §§229.40, 229.41, 229.241 - 229.252, and 229.419 - 229.430,
concerning the regulation of cosmetics, the licensing of wholesale distributors
of nonprescription drugs--including good manufacturing practices, and the
licensing of wholesale distributors of prescription drugs--including good
manufacturing practices. The department also proposes the repeal of §§229.251
- 229.254, concerning the licensing of wholesale distributors of drugs--including
good manufacturing practices.
BACKGROUND AND PURPOSE
The new sections are necessary to comply with amendments to Health and
Safety Code, Chapter 431, Subchapters I and N, relating to the licensing and
regulation of nonprescription and prescription drugs. Subchapter I of the
statute sets forth the standards for the licensing and regulation of nonprescription
drugs and requires the department to adopt rules to implement and enforce
the subchapter. Existing §§229.251 - 229.254 in Subchapter O of
Chapter 229 of this title originally set forth the requirements for all drug
and cosmetic manufacturers and distributors, but is now being proposed for
repeal in order to separate the licensing and regulation of the various commodities.
SECTION-BY-SECTION SUMMARY
New §229.40 and §229.41 reflect the regulations for cosmetic
manufacturing and labeling, setting out the Scope and Purpose and adopting
by reference the federal requirements for cosmetics.
New §§229.241 - 229.252 set forth the licensing and regulation
of manufacturers and distributors of nonprescription drugs. Section 229.241
sets forth the purpose of the rules. Section 229.242 adopts by reference the
federal requirement for nonprescription drugs. Section 229.243 sets forth
the definitions used in the rules. Section 229.244 defines sale to include
entire stream of possession of nonprescription drugs until possession by a
consumer. Sections 229.245 - 229.248 set out the exemptions from licensing;
licensing requirements; licensing procedures; and the requirements for reporting
licensure changes. Section 229.249 sets out the licensing fees for each category
of license. Section 229.250 sets forth the reasons for refusing to issue a
license, for canceling, suspending, or revoking a license. Section 229.251
sets out the minimum standards for licensure, including good manufacturing
practices. Section 229.252 sets out the enforcement and penalties provisions.
New §§229.419 - 229.430 set forth the licensing and regulation
of manufacturers and distributors of prescription drugs. Section 229.419 sets
forth the purpose of the rules. Section 229.420 adopts by reference the federal
requirement for prescription drugs. Section 229.421 sets forth the definitions
used in the rules. Section 229.422 defines sale to include entire stream of
possession of prescription drugs until possession by a consumer. Section 229.423
sets out the exemptions from licensing. Section 229.424 outlines licensing
requirements. Section 229.425 sets forth the licensing procedures, and §229.426
sets forth the requirements for reporting licensure changes. Section 229.427
sets out the licensing fees for each category of license. Section 229.428
sets forth the reasons for refusing to issue a license, for canceling, suspending,
or revoking a license. Section 229.429 sets out the minimum standards for
licensure, including good manufacturing practices. Section 229.430 outlines
enforcement and penalties provisions.
FISCAL NOTE
Susan E. Tennyson, Section Director, Environmental and Consumer Safety
Section, has determined that for each calendar year of the first five years
the sections are in effect, there will be fiscal implications to the state
as a result of enforcing or administering the sections as proposed. The effect
on state government will be an estimated increase in revenue for the state
of $462,325 in fiscal year 2006, and $462,325 in each of the fiscal years
2007 through 2010. These additional revenues will offset the increased costs
associated with the legislative increase in pay, longevity pay, and travel
reimbursement, as well as the costs of regulatory oversight. Implementation
of the proposed sections will not result in any fiscal implications for local
governments.
SMALL AND MICRO-BUSINESS IMPACT ANALYSIS
Ms. Tennyson has also determined that there are anticipated economic costs
to small businesses or micro-businesses required to comply with the sections
as proposed. There will be an increase in the licensing fees for businesses
or persons required to maintain a prescription drug or nonprescription drug
license. The probable economic cost to businesses or persons required to comply
with the fee for the license will be an increase of approximately 30% to 35%
for a two-year license. There is no anticipated negative impact on local employment.
PUBLIC BENEFIT
In addition, Ms. Tennyson has also determined that for each year of the
first five years the sections are in effect, the public will benefit from
adoption of the sections. The public benefit anticipated as a result of enforcing
or administering the sections is a reduction in the diversion of regulated
products and in the amount of counterfeit prescription drugs in the marketplace.
REGULATORY ANALYSIS
The department has determined that this proposal is not a "major environmental
rule" as defined by Government Code, §2001.0225. "Major environmental
rule" is defined to mean a rule the specific intent of which is to protect
the environment or reduce risk to human health from environmental exposure
and that may adversely affect, in a material way, the economy, a sector of
the economy, productivity, competition, jobs, the environment or the public
health and safety of a state or a sector of the state. This proposal is not
specifically intended to protect the environment or reduce risks to human
health from environmental exposure.
TAKINGS IMPACT ASSESSMENT
The department has determined that the proposed rules do not restrict or
limit an owner's right to his or her property that would otherwise exist in
the absence of government action and, therefore, do not constitute a taking
under Government Code, §2007.043.
PUBLIC COMMENT
Comments on the proposal may be submitted to Tom Brinck, Drugs and Medical
Devices Group, Environmental and Consumer Safety Section, Division for Regulatory
Services, Department of State Health Services, 1100 West 49th Street, Austin,
Texas 78756, (512) 719-0243, or by e-mail to Tom.Brinck@dshs.state.tx.us.
Comments will be accepted for 30 days following publication of the proposal
in the
Texas Register
.
LEGAL CERTIFICATION
The Department of State Health Services General Counsel, Cathy Campbell,
certifies that the proposed repeal and new rules have been reviewed by legal
counsel and found to be within the state agencies' authority to adopt.
Subchapter D. REGULATION OF COSMETICS
25 TAC §229.40, §229.41
STATUTORY AUTHORITY
The proposed new sections are authorized by Health and Safety Code, §431.241,
which authorizes the Executive Commissioner of the Health and Human Services
Commission to adopt rules necessary for the implementation and enforcement
of Chapter 431 by the department; and Government Code, §531.0055, and
Health and Safety Code, §1001.075, which authorize the Executive Commissioner
of the Health and Human Services Commission to adopt rules and policies necessary
for the operation and provision of health and human services by the department
and for the administration of Health and Safety Code, Chapter 1001.
The proposed new sections affect Health and Safety Code, Chapters 12, 431,
and 1001; and Government Code, Chapter 531.
§229.40.Purpose.
(a)
These sections set forth the requirements for the sale
of cosmetics in this state.
(b)
A "cosmetic" means articles intended to be rubbed, poured,
sprinkled, or sprayed on, introduced into, or otherwise applied to the human
body or any part of the human body for cleaning, beautifying, promoting attractiveness,
or altering the appearance, and articles intended for use as a component of
those articles. The term does not include soap.
§229.41.Applicable Laws and Regulations.
(a)
The department adopts by reference the following laws and
regulations:
(1)
Federal Food, Drug, and Cosmetic Act, 21 United States
Code, et seq., as amended;
(2)
21 Code of Federal Regulations (CFR), Part 700, General,
as amended;
(3)
21 CFR, Part 701, Cosmetic Labeling, as amended; and
(4)
21 CFR, Part 740, Cosmetic Product Warning Statements,
as amended.
(b)
Copies of these laws and regulations are indexed and filed
at the department, 1100 West 49th Street, Austin, Texas 78756, and are available
for inspection during normal working hours, 8:00 a.m. - 5:00 p.m. (except
weekends and holidays). Electronic copies of these laws and regulations are
available online at http://www.dshs.state.tx.us/license.shtm.
(c)
Nothing in these sections shall relieve any person of the
responsibility for compliance with other applicable Texas and federal laws
and regulations.
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 June 30, 2006.
TRD-200603574
Cathy Campbell
General Counsel
Department of State Health Services
Earliest possible date of adoption: August 13, 2006
For further information, please call: (512) 458-7111 x6972
25 TAC §§229.241 - 229.252
The proposed new sections are authorized by Health and Safety
Code, §431.241, which authorizes the Executive Commissioner of the Health
and Human Services Commission to adopt rules necessary for the implementation
and enforcement of Chapter 431 by the department; and Government Code, §531.0055,
and Health and Safety Code, §1001.075, which authorize the Executive
Commissioner of the Health and Human Services Commission to adopt rules and
policies necessary for the operation and provision of health and human services
by the department and for the administration of Health and Safety Code, Chapter
1001.
The proposed new sections affect Health and Safety Code, Chapters 12, 431,
and 1001; and Government Code, Chapter 531.
§229.241.Purpose.
These sections provide for the minimum licensing standards necessary
to ensure the safety and efficacy of nonprescription drugs offered for sale
by wholesale distributors.
§229.242.Applicable Laws and Regulations.
(a)
The department adopts by reference the following laws and
regulations:
(1)
Federal Food, Drug, and Cosmetic Act, 21 United States
Code, et seq., as amended;
(2)
9 Code of Federal Regulations (CFR), Part 113, Standard
Requirements, as amended;
(3)
21 CFR, Part 70, Color Additives, as amended;
(4)
21 CFR, Part 71, Color Additive Petitions, as amended;
(5)
21 CFR, Part 73, Listing of Color Additives Exempt From
Certification, as amended;
(6)
21 CFR, Part 74, Listing of Color Additives Subject to
Certification, as amended;
(7)
21 CFR, Part 80, Color Additive Certification, as amended;
(8)
21 CFR, Part 81, General Specifications and General Restrictions
for Provisional Color Additives for use in Foods, Drugs, and Cosmetics, as
amended;
(9)
21 CFR, Part 82, Listing of Certified Provisionally Listed
Colors and Specifications, as amended;
(10)
21 CFR, Part 201, Labeling, as amended;
(11)
21 CFR, Part 206, Imprinting of Solid Oral Dosage Form
Drug Products for Human Use, as amended;
(12)
21 CFR, Part 207, Registration of Producers of Drugs and
Listing of Drugs in Commercial Distribution, as amended;
(13)
21 CFR, Part 210, Current Good Manufacturing Practice
in Manufacturing, Processing, Packing, or Holding of Drugs; General, as amended;
(14)
21 CFR, Part 211, Current Good Manufacturing Practice
for Finished Pharmaceuticals, as amended;
(15)
21 CFR, Part 225, Current Good Manufacturing Practice
for Medicated Feeds, as amended;
(16)
21 CFR, Part 226, Current Good Manufacturing Practice
for Type A Medicated Articles, as amended;
(17)
21 CFR, Part 250, Special Requirements For Specific Human
Drugs, as amended;
(18)
21 CFR, Part 299, Drugs; Official Names and Established
Names, as amended;
(19)
21 CFR, Part 300, General, as amended;
(20)
21 CFR, Part 310, New Drugs, as amended;
(21)
21 CFR, Part 312, Investigational New Drug Application,
as amended;
(22)
21 CFR, Part 314, Applications for FDA Approval to Market
a New Drug or an Antibiotic Drug, as amended;
(23)
21 CFR, Part 316, Orphan Drugs, as amended;
(24)
21 CFR, Part 320, Bioavailability and Bioequivalence Requirements,
as amended;
(25)
21 CFR, Part 328, Over-the-Counter (OTC) Drug Products
Intended for Oral Ingestion that Contain Alcohol, as amended;
(26)
Part 330, Over-the-Counter (OTC) Human Drugs Which are
Generally Recognized as Safe and Effective and Not Misbranded, as amended;
(27)
21 CFR, Part 331, Antacid Products for Over-the-Counter
(OTC) Human Use, as amended;
(28)
21 CFR, Part 332, Antiflatulent Products for Over-the-Counter
(OTC) Human Use, as amended;
(29)
21 CFR, Part 333, Topical Antimicrobial Drug Products
for Over-the-Counter (OTC) Human Use, as amended;
(30)
21 CFR, Part 335, Antidiarrheal Drug Products for Over-the-Counter
(OTC) Human Use, as amended;
(31)
21 CFR, Part 336, Antiemetic Drug Products for Over-the-Counter
(OTC) Human Use, as amended;
(32)
21 CFR, Part 338, Nighttime Sleep-aid Drug Products for
Over-the-Counter (OTC) Human Use, as amended;
(33)
21 CFR, Part 340, Stimulant Drug Products for Over-the-Counter
(OTC) Human Use, as amended;
(34)
21 CFR, Part 341, Cold, Cough, Allergy, Bronchodilator,
and Anti-asthmatic Drug Products for Over-the-Counter (OTC) Human Use, as
amended;
(35)
21 CFR, Part 343, Internal Analgesic, Antipyretic, and
Antirheumatic Drug Products for Over-The-Counter (OTC) Human Use, as amended;
(36)
21 CFR, Part 344, Topical OTIC Drug Products for Over-the-Counter
(OTC) Human Use, as amended;
(37)
21 CFR, Part 346, Anorectal Drug Products for Over-the-Counter
(OTC) Human Use, as amended;
(38)
21 CFR, Part 347, Skin Protectant Drug Products for Over-the-Counter
(OTC) Human Use, as amended;
(39)
21 CFR, Part 348, External Analgesic Drug Products for
Over-the-Counter (OTC) Human Use, as amended;
(40)
21 CFR, Part 349, Ophthalmic Drug Products for Over-the-Counter
(OTC) Human Use, as amended;
(41)
21 CFR, Part 350, Antiperspirant Drug Products for Over-the-Counter
(OTC) Human Use, as amended;
(42)
21 CFR, Part 352, Sunscreen Drug Products for Over-the-Counter
(OTC) Human Use, as amended;
(43)
21 CFR, Part 355, Anticaries Drug Products for Over-the-Counter
(OTC) Human Use, as amended;
(44)
21 CFR, Part 357, Miscellaneous Internal Drug Products
for Over-the-Counter (OTC) Human Use, as amended;
(45)
21 CFR, Part 358, Miscellaneous External Drug Products
for Over-the-Counter (OTC) Human Use, as amended; and
(46)
21 CFR, Part 369, Interpretive Statements Re: Warnings
on Drugs and Devices for Over-the-Counter (OTC) Sales, as amended.
(b)
Copies of these laws and regulations are indexed and filed
at the department, 1100 West 49th Street, Austin, Texas 78756, and are available
for inspection during normal working hours, 8:00 a.m. - 5:00 p.m. (except
weekends and holidays). Electronic copies of these laws and regulations are
available online at http://www.dshs.state.tx.us/license.shtm.
(c)
Nothing in these sections shall relieve any person of the
responsibility for compliance with other applicable Texas and federal laws
and regulations.
§229.243.Definitions.
The following words and terms, when used in this subchapter, shall
have the following meanings, unless the context clearly indicates otherwise.
(1)
Act--The Texas Food, Drug, and Cosmetic Act, Health and
Safety Code, Chapter 431.
(2)
Adulterated drug--Has the meaning specified in the Texas
Food, Drug, and Cosmetic Act, Health and Safety Code, Chapter 431, §431.111.
(3)
Authorized agent--An employee of the department who is
designated by the commissioner to enforce the provisions of the Act.
(4)
Change of ownership--A sole proprietor who transfers all
or part of the facility's ownership to another person or persons; the removal,
addition, or substitution of a person or persons as a partner in a facility
owned by a partnership; a corporate sale, transfer, reorganization, or merger
of the corporation which owns the facility if sale, transfer, reorganization,
or merger causes a change in the facility's ownership to another person or
persons; or if any other type of association, the removal, addition, or substitution
of a person or persons as a principal of such association.
(5)
Commissioner--Commissioner of the Department of State Health
Services.
(6)
Cosmetic--Articles intended to be rubbed, poured, sprinkled,
or sprayed on, introduced into, or otherwise applied to the human body or
any part of the human body for cleaning, beautifying, promoting attractiveness,
or altering the appearance, and articles intended for use as a component of
those articles. The term does not include soap.
(7)
Department--The Department of State Health Services.
(8)
Device--An instrument, apparatus, implement, machine, contrivance,
implant, in vitro reagent, or other similar or related article, including
any component, part, or accessory, that is:
(A)
recognized in the official United States Pharmacopoeia
National Formulary or any supplement to it;
(B)
intended for use in the diagnosis of disease or other conditions,
or in the cure, mitigation, treatment, or prevention of disease in man or
other animals; or
(C)
intended to affect the structure or any function of the
body of man or other animals and that does not achieve any of its principal
intended purposes through chemical action within or on the body of man or
other animals and is not dependent on metabolization for the achievement of
any of its principal intended purposes.
(9)
Drug--Articles recognized in the official United States
Pharmacopoeia National Formulary, or any supplement to it, articles designated
or intended for use in the diagnosis, cure, mitigation, treatment, or prevention
of disease in man or other animals, articles, other than food, intended to
affect the structure or any function of the body of man or other animals,
and articles intended for use as a component of any such article. The term
does not include devices or their components, parts, or accessories. A food
for which a claim is made in accordance with the Federal Act, §403(r),
and for which the claim is approved by the U.S. Food and Drug Administration,
is not a drug solely because the label or labeling contains such a claim.
(10)
Federal Act--Federal Food, Drug, and Cosmetic Act, 21
United States Code, et seq., as amended.
(11)
Flea market--A location at which booths or similar spaces
are rented or otherwise made available temporarily to two or more persons
and at which the persons offer tangible personal property for sale.
(12)
Labeling--All labels and other written, printed, or graphic
matter:
(A)
upon any drug or any of its containers or wrappers; or
(B)
accompanying such drug.
(13)
Manufacturer--A person who manufactures, prepares, propagates,
compounds, processes, packages, or repackages nonprescription drugs, or a
person who changes the container, wrapper, or labeling of any nonprescription
drug package.
(14)
Misbranded drug--Has the meaning specified in the Texas
Food, Drug, and Cosmetic Act, Health and Safety Code, Chapter 431, §431.112.
(15)
Nonprescription drug--Any drug that is not a prescription
drug, and includes the term "Over the Counter Drug."
(16)
Nonprescription drug product--A finished dosage form,
for example, tablet, capsule, solution, etc., that contains an active nonprescription
drug ingredient generally, but not necessarily, in association with inactive
ingredients. The term also includes a finished dosage form that does not contain
an active ingredient but is intended to be used as a placebo. Any nonprescription
drug product that is also a cosmetic or device or component thereof is also
subject to the applicable requirements of the Federal Act, Chapters V and
VI, and Subchapters E and F; and Subchapter D of this chapter (relating to
Regulation of Cosmetics) and Subchapter X of this chapter (relating to Licensing
of Device Distributors and Manufacturers).
(17)
Person--An individual, corporation, business trust, estate,
trust, partnership, association, or any other public or private legal entity.
(18)
Place of business--Each location at which a nonprescription
drug for wholesale distribution is located.
(19)
Prescription drug--Any drug (including any biological
product, except for blood and blood components intended for transfusion or
biological products that are also medical devices) required by Federal law
(including Federal regulation) to be dispensed only by a prescription, including
finished dosage forms and bulk drug substances subject to the Federal Act, §503(b).
(20)
Wholesale distribution--Distribution to a person other
than a consumer or patient, including, but not limited to distribution to
any person by a manufacturer, repackager, own label distributor, broker, jobber,
warehouse, or wholesaler.
§229.244.Sale of Nonprescription Drugs.
Any reference in these sections to the sale of nonprescription drugs
shall be considered to include the manufacture, packaging, exposure, offer,
possession, and holding of any nonprescription drug for sale; the sale, dispensing,
and giving of any nonprescription drug; and supplying or applying of any nonprescription
drug in the operation of any nonprescription drug place of business.
§229.245.Exemption.
(a)
A person is exempt from licensing a place of business in
accordance with §229.246 of this title (relating to Licensure Requirements)
if the person holds a license for the place of business issued by the department
under Subchapter W of this chapter (relating to Licensing of Wholesale Distributors
of Prescription Drugs--Including Good Manufacturing Practices).
(b)
An exemption from the licensing requirement granted in
subsection (a) of this section does not constitute an exemption from other
applicable requirements for nonprescription drugs in these sections or under
the Texas Food, Drug, and Cosmetic Act, Health and Safety Code, Chapter 431.
§229.246.Licensure Requirements.
(a)
General. Except as provided by §229.245 of this title
(relating to Exemption), a person may not engage in the wholesale distribution
of nonprescription drugs in Texas unless the person has a valid license from
the department for each place of business.
(b)
Out-of-state place of business. Except as provided by §229.245
of this title, a person who engages in the wholesale distribution of nonprescription
drugs from outside this state may only engage in the wholesale distribution
of nonprescription drugs in this state if the person holds a license as required
under subsection (a) of this section.
(c)
Combination product. If the United States Food and Drug
Administration determines, with respect to a product that is a combination
of a nonprescription drug and a device, that the primary mode of action of
the product is as a nonprescription drug, a wholesale distributor of such
a product is subject to licensure as described in this section.
(d)
Display of license. The license shall be displayed in an
open public area at each place of business.
(e)
New place of business. Each person acquiring or establishing
a place of business for the purpose of wholesale distribution of nonprescription
drugs after the effective date of these sections shall apply to the department
for a license of such business prior to beginning operation.
(f)
Two or more places of business. If the wholesale distributor
of nonprescription drugs operates more than one place of business, the wholesale
distributor of nonprescription drugs shall license each place of business
separately.
(g)
Pre-licensing inspection. The applicant shall cooperate
with any pre-licensing inspection by the department of the applicant's place
of business. The department may accept reports from authorities in other jurisdictions
to determine the extent of compliance with the minimum standards in these
sections for applicants located out-of-state.
(h)
Issuance of license. In accordance with §229.281 of
this title (relating to Processing License/Permit Applications Relating to
Food and Drug Operations), the department may license a wholesale distributor
of nonprescription drugs who meets the requirements of these sections, and
pays all license fees in compliance with §229.249 of this title (relating
to Licensure Fees).
(i)
Transfer of license. Licenses shall not be transferable
from one person to another or from one place of business to another.
(j)
License term. Unless the license is amended as provided
in subsection (k) of this section or suspended or revoked as provided in §229.250
of this title (relating to Refusal, Cancellation, Suspension, or Revocation
of a License), the license is valid for two years.
(k)
Amendment of license. A license that is amended, including
a change of name, ownership, or a notification of a change in the location
of a licensed place of business will require submission of an application
as outlined in §229.247 of this title (relating to Licensing Procedures)
and submission of fees as outlined in §229.249 of this title.
(l)
Renewal of license.
(1)
The license application as outlined in §229.247 of
this title and nonrefundable licensing fees as outlined in §229.249 of
this title for each place of business shall be submitted to the department
prior to the expiration date of the current license. A person who files a
renewal application after the expiration date must pay an additional $100
as a delinquency fee.
(2)
A licensee who fails to submit a renewal application prior
to the current licensure expiration date and continues operations may be subject
to the enforcement and penalty provisions in §229.252 of this title (relating
to Enforcement and Penalties), and/or the refusal, cancellation, suspension
and revocation provisions in §229.250 of this title.
(3)
A renewal license shall only be issued when all past due
license fees and delinquency fees are paid.
§229.247.Licensing Procedures.
(a)
License application forms. License application forms may
be obtained from the department, 1100 West 49th Street, Austin, Texas, 78756,
or online at http://www.dshs.state.tx.us/license.shtm.
(b)
Contents of license application. The application for licensure
as a wholesale distributor of nonprescription drugs shall be signed and verified,
submitted on a license application form furnished by the department, and contain
the following information:
(1)
the name of the legal entity to be licensed, including
the name under which the business is conducted;
(2)
the address of each place of business that is licensed;
(3)
if a proprietorship, the name and residence address of
the proprietor; if a partnership, the names and residence addresses of all
partners; if a corporation, the date and place of incorporation and name and
address of its registered agent in the state and corporation charter number;
or if any other type of association, the names of the principals of such association;
(4)
the name, residence address, and valid driver license number
for each individual in an actual administrative capacity which, in the case
of proprietorship, shall be the managing proprietor; partnership, the managing
partner; corporation, the officers and directors; or those in a managerial
capacity in any other type of association;
(5)
for each place of business, the residence address of the
individual in charge thereof;
(6)
a list of categories which must be marked and adhered to
in the determination and payment of the fee; and
(7)
a statement verified by the applicant's signature that
acknowledges the applicant has read, understood, and agrees to abide by the
provisions of these sections and those of the Texas Food, Drug, and Cosmetic
Act, Health and Safety Code, Chapter 431.
(c)
Renewal license application. The renewal application for
licensure as a wholesale distributor of nonprescription drugs shall be made
on a license application form furnished by the department.
(d)
Texas Online. Applicants may submit initial and renewal
license applications under these sections electronically by the Internet through
Texas Online at www.texasonline.state.tx.us. The department is authorized
to collect fees, in amounts determined by the Texas Online Authority, to recover
costs associated with application and renewal application processing through
Texas Online.
§229.248.Report of Changes.
(a)
Change in the content of a license application. The license
holder shall notify the department in writing within ten days of any change
which would render the information contained in the application for the license,
reported pursuant to §229.247 of this title (relating to Licensing Procedures),
no longer accurate. Failure to inform the department no later than ten days
of a change in the information required in the application for a license may
result in a suspension or revocation of the license.
(b)
Change in location of place of business. Not fewer than
30 days in advance of the change, the licensee shall notify the department
in writing of the licensee's intent to change the location of a licensed place
of business. The notice shall include the address of the new location, and
the name and residence address of the individual in charge of the business
at the new location. Not more than 10 days after the completion of the change
of location, the licensee shall notify the department in writing to confirm
the completion of the change of location, and provide verification of the
information previously provided or correct and confirm any information that
has changed since providing the notice of intent. The notice and confirmation
required by this subsection will be deemed adequate if the licensee sends
the notices by certified mail, return receipt requested, to the department
at 1100 West 49th Street, Austin, Texas 78756, or submits them electronically
through the Texas Online Internet website.
§229.249.Licensure Fees.
(a)
License fee. Except as provided by §229.245 of this
title (relating to Exemption), no person may operate or conduct business as
a wholesale distributor of nonprescription drugs without first obtaining a
license from the department. All applicants for an initial wholesale distributor
of nonprescription drugs license or a renewal license shall pay a licensing
fee unless otherwise exempt as provided by subsection (c) of this section.
All fees are nonrefundable. Licenses are issued for two-year terms. A license
shall only be issued when all past due license fees and delinquency fees are
paid.
(1)
In-state wholesale distributors of nonprescription drugs
who are not manufacturers shall pay a two-year license fee based on the gross
annual sales of all nonprescription drugs.
(A)
For a wholesale distributor with gross annual nonprescription
drug sales of $0 - $199,999.99, the fees are:
(i)
$1,040 for a two-year license;
(ii)
$1,040 for a two-year license that is amended due to a
change of ownership; and
(iii)
$520 for a license that is amended during the current
licensure period due to minor changes.
(B)
For a wholesale distributor with gross annual nonprescription
drug sales of $200,000 - $19,999,999.99, the fees are:
(i)
$1,690 for a two-year license;
(ii)
$1,690 for a two-year license that is amended due to a
change of ownership; and
(iii)
$845 for a license that is amended during the current
licensure period due to minor changes.
(C)
For a wholesale distributor with gross annual nonprescription
drug sales greater than or equal to $20 million, the fees are:
(i)
$2,210 for a two-year license;
(ii)
$2,210 for a two-year license that is amended due to a
change of ownership; and
(iii)
$1,105 for a license that is amended during the current
licensure period due to minor changes.
(2)
In-state wholesale distributors of nonprescription drugs
who are not manufacturers and who also are required to be licensed as a device
distributor under §229.439(a) of this title (relating to Licensure Fees)
or as a wholesale food distributor under §229.182(a)(3) of this title
(relating to Licensing/Registration Fee and Procedures) shall pay a combined
two-year license fee for each place of business. License fees are based on
the combined gross annual sales of these regulated products (foods, drugs,
and/or devices).
(A)
For each place of business having combined gross annual
sales of $0 - $199,999.99, the fees are:
(i)
$520 for a two-year license;
(ii)
$520 for a two-year license that is amended due to a change
of ownership; and
(iii)
$260 for a license that is amended during the current
licensure period due to minor changes.
(B)
For each place of business having combined gross annual
sales of $200,000 - $499,999.99, the fees are:
(i)
$780 for a two-year license;
(ii)
$780 for a two-year license that is amended due to a change
of ownership; and
(iii)
$390 for a license that is amended during the current
licensure period due to minor changes.
(C)
For each place of business having combined gross annual
sales of $500,000 - $999,999.99, the fees are:
(i)
$1,040 for a two-year license;
(ii)
$1,040 for a two-year license that is amended due to a
change of ownership; and
(iii)
$520 for a license that is amended during the current
licensure period due to minor changes.
(D)
For each place of business having combined gross annual
sales of $1 million - $9,999,999.99, the fees are:
(i)
$1,300 for a two-year license;
(ii)
$1,300 for a two-year license that is amended due to a
change of ownership; and
(iii)
$650 for a license that is amended during the current
licensure period due to minor changes.
(E)
For each place of business having combined gross annual
sales greater than or equal to $10 million, the fees are:
(i)
$1,950 for a two-year license;
(ii)
$1,950 for a two-year license that is amended due to a
change of ownership; and
(iii)
$975 for a license that is amended during the current
licensure period due to minor changes.
(3)
In-state wholesale distributors of nonprescription drugs
who are manufacturers shall pay a two-year license fee based on the gross
annual sales of all nonprescription drugs.
(A)
For a wholesale distributor with gross annual nonprescription
drug sales of $0 - $199,999.99, the fees are:
(i)
$1,040 for a two-year license;
(ii)
$1,040 for a two-year license that is amended due to a
change of ownership; and
(iii)
$520 for a license that is amended during the current
licensure period due to minor changes.
(B)
For a wholesale distributor with gross annual nonprescription
drug sales of $200,000 - $19,999,999.99, the fees are:
(i)
$1,690 for a two-year license;
(ii)
$1,690 for a two-year license that is amended due to a
change of ownership; and
(iii)
$845 for a license that is amended during the current
licensure period due to minor changes.
(C)
For a wholesale distributor with gross annual nonprescription
drug sales greater than or equal to $20 million, the fees are:
(i)
$2,210 for a two-year license;
(ii)
$2,210 for a two-year license that is amended due to a
change of ownership; and
(iii)
$1,105 for a license that is amended during the current
licensure period due to minor changes.
(4)
Out-of-state wholesale distributors of nonprescription
drugs shall pay a two-year license fee based on all gross annual sales of
nonprescription drugs delivered into Texas.
(A)
For each wholesale distributor with gross annual nonprescription
drug sales of $0 - $19,999,999, the fees are:
(i)
$1,300 for a two-year license;
(ii)
$1,300 for a two-year license that is amended due to a
change of ownership; and
(iii)
$650 for a license that is amended during the current
licensure period due to minor changes.
(B)
For each wholesale distributor with gross annual nonprescription
drug sales of greater than or equal to $20 million, the fees are:
(i)
$1,950 for a two-year license;
(ii)
$1,950 for a two-year license that is amended due to a
change of ownership; and
(iii)
$975 for a license that is amended during the current
licensure period due to minor changes.
(b)
Proration of license fees. A person that has more than
one place of business may request a one-time proration of the license fees
when applying for a license for each new place of business. Upon approval
by the department, the license for the new place of business will have a renewal
date that is the same as the firm's other licensed places of business.
(c)
Exemption from license fees. A person is exempt from the
license fees required by this section if the person is a charitable organization,
as described in the Internal Revenue Code of 1986, §501(c)(3), or a nonprofit
affiliate of the organization, to the extent otherwise permitted by law.
§229.250.Refusal, Cancellation, Suspension or Revocation of License.
(a)
The commissioner may refuse an application for a wholesale
distributor of nonprescription drugs license or may suspend or revoke such
a license if the applicant or licensee:
(1)
has been convicted of a felony or misdemeanor that involves
moral turpitude;
(2)
is an association, partnership, or corporation and the
managing officer and/or any officer or director of the corporation has been
convicted of a felony or misdemeanor that involves moral turpitude;
(3)
is an association, partnership, or corporation and the
managing officer and/or any officer or director of the corporation has been
convicted of a felony or misdemeanor involving the illegal use, sale, or transportation
of intoxicating liquors, narcotic drugs, barbiturates, amphetamines, desoxyephedrine,
their compounds or derivatives, or any other dangerous or habit-forming drugs;
(4)
has violated any of the provisions of the Texas, Food,
Drug, and Cosmetic Act, Health and Safety Code, Chapter 431 (Act) or these
sections;
(5)
has violated the Health and Safety Code, §431.021(1)(3),
concerning the counterfeiting of a drug or the sale or holding for sale of
a counterfeit drug;
(6)
has violated the Health and Safety Code, Chapter 481 (Texas
Controlled Substance Act), or the Health and Safety Code, Chapter 483 (Dangerous
Drug Act);
(7)
has violated the rules of the director of the Department
of Public Safety, including being responsible for a significant discrepancy
in the records that state law requires the applicant or licensee to maintain;
(8)
has failed to complete a license application or submits
an application that contains false, misleading, or incorrect information or
contains information that cannot be verified by the department;
(9)
has failed to pay a license fee or a renewal fee for a
license; or
(10)
has obtained or attempted to obtain a license by fraud
or deception.
(b)
The department may, after providing opportunity for hearing,
refuse to license a wholesale distributor of nonprescription drugs, or may
suspend or revoke a license for violations of the requirements in these sections
or for any of the reasons described in the Act.
(c)
Any hearings for the refusal, suspension, or revocation
of a license are governed by §§1.21, 1.23, 1.25, and 1.27 of this
title (relating to Formal Hearing Procedures).
(d)
If the department suspends a license, the suspension shall
remain in effect until the department determines that the reason for the suspension
no longer exists. If the suspension overlaps a renewal date, the suspended
license holder shall comply with the renewal procedures in §229.247 of
this title (relating to Licensing Procedures); however, the department may
choose not to renew the license until the department determines that the reason
for suspension no longer exists.
(e)
If the department revokes or does not renew a license,
a person may reapply for a license by complying with the requirements and
procedures in §229.247 of this title at the time of reapplication. The
department may refuse to issue a license if the reason for revocation or non-renewal
continues to exist.
(f)
A license issued under these sections shall be returned
to the department if the person's place of business:
(1)
ceases business or otherwise ceases operation on a permanent
basis;
(2)
relocates; or
(3)
changes name or ownership. For a corporation, an ownership
change is deemed to have occurred, resulting in the necessity to return the
license to the department, when 5.0% or more of the share of stock of a corporation
is transferred from one person to another.
§229.251.Minimum Standards for Licensure.
(a)
General requirements. All persons engaged in the wholesale
distribution of nonprescription drugs must comply with the applicable minimum
standards in this section, in addition to the statutory requirements contained
in the Texas Food, Drug, and Cosmetic Act, Health and Safety Code, Chapter
431 (Act) and those requirements adopted in §229.242 of this title (relating
to Applicable Laws and Regulations). For the purpose of this section, the
policies described in the United States Food and Drug Administration's (FDA's)
Compliance Policy Guides as they apply to nonprescription drugs shall be the
policies of the department.
(b)
Federal establishment registration and drug listing. All
persons who operate as nonprescription drug manufacturers in Texas shall meet
the requirements in 21 Code of Federal Regulations (CFR), Part 207, titled
"Registration of Producers of Drugs and Listing of Drugs in Commercial Distribution."
New nonprescription drugs offered for sale by wholesale distributors shall
have met, if applicable, the requirements of 21 CFR, Part 314, titled "Applications
for FDA Approval to Market a New Drug."
(c)
Good manufacturing practices. Manufacturers of nonprescription
drug products shall be in compliance with the applicable requirements in 21
CFR, Part 210, titled "Current Good Manufacturing Practice in Manufacturing,
Processing, Packing, or Holding of Drugs"; 21 CFR, Part 211, titled "Current
Good Manufacturing Practice for Finished Pharmaceuticals; General"; 21 CFR,
Part 225, titled "Current Good Manufacturing Practice for Medicated Feeds";
and 21 CFR, Part 226, titled "Current Good Manufacturing Practice for Type
A Medicated Article." The regulations in these parts govern the methods used
in, and the facilities or controls used for, the manufacture, processing,
packing, or holding of a drug to assure that each drug meets the requirements
of the Federal Act as to safety, and has the identity and strength and meets
the quality and purity characteristics that it purports or is represented
to possess.
(d)
Buildings and facilities.
(1)
All manufacturing, processing, packing, or holding of drugs
by nonprescription drug manufacturers shall take place in buildings and facilities
described in subsection (c) of this section.
(2)
No manufacturing, processing, packing, or holding of nonprescription
drugs shall be conducted in any personal residence.
(3)
No sale of nonprescription drugs shall be conducted in
any flea market.
(4)
Any place of business used by a wholesale distributor of
nonprescription drugs who is not a manufacturer to store, warehouse, hold,
offer, transport, or display drugs shall:
(A)
be of suitable size and construction to facilitate cleaning,
maintenance, and proper operations;
(B)
have storage areas designed to provide adequate lighting,
ventilation, temperature, sanitation, humidity, and space;
(C)
be maintained in a clean and orderly condition;
(D)
be free from infestation by insects, rodents, birds, or
vermin of any kind; and
(E)
have a quarantine area for storage of drugs that are outdated,
damaged, deteriorated, misbranded, or adulterated.
(e)
Storage of nonprescription drugs. All nonprescription drugs
stored by wholesale distributors shall be held at appropriate temperatures
and under appropriate conditions in accordance with requirements, if any,
in the labeling of such drugs.
(f)
Operating procedures for wholesale distributors who are
not manufacturers. Written procedures describing the holding of nonprescription
drug products by wholesale distributors of nonprescription drugs who are not
manufacturers shall be established and followed and shall include:
(1)
a procedure for identifying and retrieving nonprescription
drug products that are subject to a recall; and
(2)
a quarantine procedure for nonprescription drug products
that have expired; are subject to recall; or are otherwise determined to be
adulterated or misbranded for the return, destruction, or other disposal of
those items.
(g)
Nonprescription drug labeling. Nonprescription drugs sold
by wholesale distributors shall meet the labeling requirements of the Act
and 21 CFR, Part 201, titled "Labeling."
(h)
Nonprescription drugs that are combination products. Any
nonprescription drug that is a combination product as described in §229.246(c)
of this title (relating to Licensure Requirements) is also subject to the
applicable requirements in Subchapter X of this chapter (relating to Licensing
of Device Distributors and Manufacturers).
(i)
Nonprescription drugs that are also cosmetics. Any nonprescription
drug that is also a cosmetic or component thereof is also subject to the applicable
requirements of Subchapter D of this chapter (relating to Regulation of Cosmetics).
§229.252.Enforcement and Penalties.
(a)
Inspection. To enforce these sections or the Texas Food,
Drug, and Cosmetic Act, Health and Safety Code, Chapter 431 (Act), the commissioner,
an authorized agent, or a health authority may, on presenting appropriate
credentials to the owner, operator, or agent in charge of a place of business:
(1)
enter at reasonable times a place of business, including
a factory or warehouse, in which a nonprescription drug is manufactured, packed,
or held for introduction into commerce or held after the introduction;
(2)
enter a vehicle being used to transport or hold a nonprescription
drug in commerce; or
(3)
inspect at reasonable times, within reasonable limits,
and in a reasonable manner, the place of business or vehicle and all equipment,
finished and unfinished materials, containers, and labeling of any item, and
obtain samples necessary for the enforcement of these sections or the Act.
(b)
Receipt for samples. An authorized agent or health authority
who makes an inspection of a place of business, including a factory or warehouse,
and obtains a sample during or on completion of the inspection and before
leaving the place of business, shall give to the owner, operator, or the owner's
or operator's agent a receipt describing the sample.
(c)
Access to records.
(1)
A person who is required to maintain records referenced
in these sections or under the Texas Food, Drug, and Cosmetic Act, Health
and Safety Code, Chapter 431 (Act), or Federal Food, Drug, and Cosmetic Act
(Federal Act), Chapter V, or a person who is in charge or custody of those
records shall, at the request of an authorized agent or health authority,
permit the authorized agent or health authority at all reasonable times access
to and to copy and verify the records.
(2)
A person, including a carrier engaged in commerce, or other
person receiving a nonprescription drug in commerce or holding a nonprescription
drug received in commerce shall, at the request of an authorized agent, permit
the authorized agent at all reasonable times to have access to and to copy
and verify all records showing:
(A)
the movement in commerce of any nonprescription drug;
(B)
the holding of any nonprescription drug after movement
in commerce; and
(C)
the quantity, shipper, and consignee of any nonprescription
drug.
(d)
Retention of records. Records required by these sections
shall be maintained at the place of business or other location that is reasonably
accessible for a period of at least three years following disposition of the
nonprescription drug unless a greater period of time is required by laws and
regulations adopted in §229.242 of this title (relating to Applicable
Laws and Regulations).
(e)
Adulterated and misbranded nonprescription drug. If the
department identifies an adulterated or misbranded nonprescription drug, the
department may impose the applicable provisions of Subchapter C of the Act
including, but not limited to: detention, emergency order, recall, condemnation,
destruction, injunction, civil penalties, criminal penalties, and/or administrative
penalties. Administrative and civil penalties will be assessed using the Severity
Levels contained in §229.251 of this title (relating to Minimum Standards
for Licensure).
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 June 30, 2006.
TRD-200603575
Cathy Campbell
General Counsel
Department of State Health Services
Earliest possible date of adoption: August 13, 2006
For further information, please call: (512) 458-7111 x6972
Subchapter O. LICENSING OF WHOLESALE DISTRIBUTORS OF NONPRESCRIPTION DRUGS--INCLUDING GOOD MANUFACTURING PRACTICES
Subchapter O. LICENSING OF WHOLESALE DISTRIBUTORS OF DRUGS--INCLUDING GOOD MANUFACTURING PRACTICES