24:6B-15 Licensure required for pharmaceutical wholesale distributors.

6. a. A wholesale distributor engaged in the wholesale distribution of prescription drugs within this State, whether or not the wholesale distributor is located in this State, shall be licensed by the department. If wholesale distribution operations are conducted at more than one location, each such location shall be licensed. The department may establish reciprocal agreements with any state that has a drug wholesale licensure and standards program that is at least as protective as the requirements set forth under this act.

b. A wholesale distributor shall renew its license annually and pay a license fee established by the commissioner. License fees shall be used to support administrative and programmatic activities under this act.

c. The commissioner shall establish the licensing and renewal form and application process. An applicant shall provide the following information, in addition to any other information that the commissioner may require:

(1) all trade or business names, including current and former fictitious business names used by the licensee, which names shall not be identical to any name used by another unrelated wholesale distributor licensed to purchase or sell prescription drugs in this State;

(2) the name, business address, Social Security number and date of birth of each owner, partner or sole proprietor, as applicable, and each operator, and

(a) if a partnership, the business name of the partnership and federal employer identification number;

(b) if a corporation, the name, business address, Social Security number, date of birth, and title of each corporate officer and director, the corporate name including the name of any parent company, the state of incorporation, federal employer identification number and name, address and Social Security number of each shareholder owning 10% or more of voting stock;

(c) if a sole proprietorship, the federal employer identification number; or

(d) if a limited liability company, the name of each member and each manager, the company name and federal employer identification number;

(3) the name, business address and telephone number of each person who is serving as the designated representative pursuant to section 10 of this act;

(4) a list of states in which the wholesale distributor is licensed to purchase, possess and distribute prescription drugs, and into which it ships prescription drugs;

(5) information regarding general and product liability insurance, including certification of relevant coverage;

(6) a list of managerial employees;

(7) a list of all disciplinary actions by state and federal agencies over the last four years;

(8) a description, including the address, dimensions, and other relevant information, of each facility or warehouse used for prescription drug storage and distribution;

(9) a description of prescription drug import and export activities of the wholesale distributor;

(10) a description of the applicant's written procedures as required under section 19 of this act; and

(11) if involved in the distribution of controlled dangerous substances, evidence of registration with the department, as required in section 2 of P.L.1970, c.226 (C.24:21-10), and evidence of registration with the DEA.

d. (1) The commissioner shall require from an applicant a surety bond of not less than $100,000, or evidence of other equivalent means of security acceptable to the department, such as insurance, an irrevocable letter of credit or funds deposited in a trust account or financial institution to secure payment of any administrative penalties imposed by the department and any fees or costs incurred by the department regarding that license when those penalties, fees or costs are authorized under State law and the licensee fails to pay 30 days after the penalty, fees or costs becomes final.

(2) The commissioner may accept a surety bond of $25,000 if the annual gross receipts of the previous tax year for the wholesale distributor is $10,000,000 or less.

(3) A separate surety bond or other equivalent means of security shall not be required for each company's separate locations or for affiliated companies or groups when those separate locations or affiliated companies or groups are required to apply for or renew their wholesale distributor license with the department.

(4) The surety bond requirement may be waived, at the discretion of the commissioner, if the wholesale distributor previously has obtained a comparable surety bond or other equivalent means of security for the purpose of licensure in another state where the wholesale distributor possesses a valid license in good standing, provided that a reciprocal agreement exists between this State and the other state that extends authority to this State to make a claim against the surety bond or other equivalent means of security.

(5) The department may make a claim against the bond or other equivalent means of security until one year after the wholesale distributor's license ceases to be valid or until 60 days after the conclusion of any administrative or legal proceeding before or on behalf of the department which involves the wholesale distributor, including any appeal, whichever occurs later.

e. A licensed wholesale distributor located outside this State who distributes prescription drugs in this State may designate a registered agent in this State for service of process. A licensed wholesale distributor who fails to designate a registered agent shall be deemed to have designated the Secretary of State of this State to be its true and lawful attorney.

f. Each wholesale distribution facility in this State shall undergo an inspection by the department prior to initial licensure and at least once every three years thereafter, in accordance with a schedule to be determined by the commissioner. The department shall use qualified inspectors specifically trained to conduct inspections of wholesale distributors, who shall be required to maintain current training and knowledge regarding the wholesale prescription drug distribution industry. The department may contract with a third party organization that is nationally recognized as having expertise in pharmaceutical drug distribution to meet the inspection requirements of this section.

g. A wholesale distributor shall publicly display or have readily available all licenses and the most recent inspection report issued by the department.

h. The department shall make publicly available on its website the dates of the first and most recent inspections of each wholesale distributor.

i. The department shall notify appropriate parties upon the suspension, revocation or expiration, or other relevant action regarding, a wholesale distributor's license and make that information available on its website within five business days.

j. A licensee shall submit to the department any change in information within 30 days of that change, unless otherwise noted.

L.2005,c.206,s.6.