Section 39I. (a)(1) The board shall establish a category of pharmacy licensure for institutional pharmacies engaged in sterile compounding. An institutional sterile compounding pharmacy license issued by the board shall be obtained in addition to and not in place of any other permit or license an entity operating an institutional pharmacy holds.

(2) An institutional sterile compounding pharmacy license shall be non-transferable and shall be renewed annually. The fee for the renewal shall be determined annually by the secretary of administration and finance pursuant to section 3B of chapter 7.

(3) An institutional sterile compounding pharmacy license shall be valid only for the premises and shall list the specific locations on the premises where a licensee compounds sterile drug preparations.

(4) The license shall not be renewed until each location where a licensee compounds sterile drug preparations has been inspected by the board and found to be in compliance with this chapter and regulations adopted by the board. The board shall conduct unannounced random and risk-based inspections of all institutional sterile compounding pharmacies licensed under this chapter, as well as the sterile drug preparations compounded by such pharmacies.

(5) An institutional sterile compounding pharmacy licensed by the commonwealth shall adhere to the most current standards established by USP, all chapters, when engaging in any form of sterile compounding. Such pharmacy shall also adhere to the additional regulations promulgated by the board pursuant to subsection (c).

(6) All institutional sterile compounding pharmacies shall report to the board, on an annual basis, a list of prescriptions dispensed within and outside of the commonwealth, as well as the volume of these prescriptions. An institutional sterile compounding pharmacy that ships compounded drug preparations outside of the commonwealth shall, in addition to the requirements in this section, report to the board the names of the states to which the pharmacy has shipped sterile drug preparations.

(7) The license shall not be renewed until the licensee certifies that their employees engaged in sterile compounding have been trained in lean concepts, which are tools that assist in the identification and steady elimination of waste and promote continuous improvement in quality and efficiency.

(b) An institutional sterile compounding pharmacy shall designate a manager of record who shall:

(i) disclose to the board the name, title and Massachusetts license number of all licensed pharmacists managing or supervising a specific location on the premises where a licensee compounds sterile drug preparations;

(ii) certify the institutional sterile compounding pharmacy's compliance with reasonable informational requests made by the board;

(iii) certify to the board that the manager of record has fulfilled continuing education requirements for sterile compounding and ensured that all pharmacy staff has received the appropriate training and education required by law and regulations before engaging in compounding; and

(iv) submit to the board the names and titles of all individuals employed by the licensee engaged in sterile compounding;

(v) annually, and within 30 days after any change of office, corporate office or manager of record, file a report containing the information disclosed under clause (i).

(c)(1) The board shall establish a list of procedural criteria on which an institutional sterile compounding pharmacy shall be evaluated at the time of inspection. The procedural criteria shall contain a predetermined list of standards and safeguards upon which a institutional sterile compounding pharmacy shall be inspected, as well as a predetermined yet alternating list of variable criteria upon which the pharmacy may be inspected without prior notice as to which subset of these variable criteria shall be included in the inspection.

(2) The board shall develop a quality assurance procedure for institutional sterile compounding pharmacies to adhere to including, but not limited to, procedures to enhance physical inspection, compounding accuracy checks and sterility testing.

(3) The board shall establish supplementary regulations for all institutional sterile compounding pharmacies intending to compound or dispense sterile drug preparations in the commonwealth. The regulations shall include, but not be limited to: (i) enhancing environmental monitoring procedures; (ii) enhancing media fill testing procedures; (iii) enhancing non-sterile active pharmaceutical ingredient controls; (iv) enhancing procedures testing endotoxin and bioburden levels of compounded drug preparations; (v) enhancing procedures surrounding process validation and reproducibility of compounded drug preparations; (vi) enhancing procedures related to end stage testing of sterile drug preparations; (vii) enhancing procedures relating to the storage and beyond-use-dating of sterile drug preparations; (viii) enhancing the physical inspection process for finished sterile drug preparations; (ix) developing effective formulation records for institutional sterile compounding pharmacies; (x) developing effective compounding records for drug preparations compounded by institutional sterile compounding pharmacies; and (xi) developing effective procedures to maintain a drug preparation's quality and control after the sterile drug preparation leaves the institutional sterile compounding pharmacy.

(4) The board shall review current regulations applicable to institutional pharmacies and shall promulgate regulations for the administration of paragraphs (1), (2) and (3) of this subsection appropriate to the practice setting of entities subject to an institutional sterile compounding pharmacy license and which minimize regulatory and reporting duplication; provided, that no such regulation shall exempt an institutional sterile compounding pharmacy from compliance with the most current standards established by USP, all chapters.