| (a) General. Except as provided in §229.423 of
this subchapter (relating to Exemptions), a person may not engage
in the wholesale distribution of prescription drugs in Texas, as defined
in §229.421(30) - (31) of this subchapter (relating to Definitions),
unless the person has a valid license from the commissioner of the
department for each place of business.
(b) Out-of-state place of business.
(1) Except as provided by §229.423 of this subchapter,
a person who engages in the wholesale distribution of prescription
drugs from outside this state may only engage in the wholesale distribution
of prescription drugs in this state if the person holds a license
as required in subsection (a) of this section.
(2) The department may accept reports from authorities
in other jurisdictions to determine the extent of compliance with
the Texas Food, Drug, and Cosmetic Act, Health and Safety Code, Chapter
431 and this subchapter.
(3) The department may issue a license to a person
who engages in the wholesale distribution of prescription drugs outside
this state to engage in the wholesale distribution of prescription
drugs in this state if, after an examination of the reports of the
person's compliance history and current compliance record, the department
determines the person is in compliance with the Act and this subchapter.
(4) The department considers each license application
and any related documents or reports filed by or in connection with
a person who wishes to engage in the wholesale distribution of prescription
drugs in this state on an individual basis.
(c) Combination product. If the United States Food
and Drug Administration determines, with respect to a product that
is a combination of a prescription drug and a device, the primary
mode of action of the product is as a prescription drug, a wholesale
distributor of such a product is subject to licensure as described
in this section.
(d) Applicant qualifications. To qualify for the issuance
or renewal of a wholesale distributor license under this subchapter,
the designated representative of an applicant or license holder must:
(1) be at least 21 years of age;
(2) have been employed full-time for at least three
years by a pharmacy or a wholesale distributor in a capacity related
to the dispensing or distributing of prescription drugs, including
recordkeeping for the dispensing or distributing of prescription drugs;
(3) be employed by the applicant full-time in a managerial-level
position;
(4) be actively involved in and aware of the actual
daily operation of the wholesale distributor;
(5) be physically present at the applicant's place
of business during regular business hours, except when the absence
of the designated representative is authorized, including sick leave
and vacation leave;
(6) serve as a designated representative for only one
applicant at any one time, except in a circumstance, as the department
determines reasonable, in which more than one licensed wholesale distributor
is co-located in the same place of business at the same address and
the wholesale distributors are members of an affiliated group, as
defined by the Internal Revenue Code of 1986, 26 USC §1504;
(7) not have been convicted of a violation of any federal,
state, or local laws relating to wholesale or retail prescription
drug distribution or the distribution of controlled substances; and
(8) not have been convicted of a felony under a federal,
state, or local law.
(e) Proof of licensure. The license holder must show
proof of licensure in a format readily available to the public and
at each place of business.
(f) New place of business. Each person acquiring or
establishing a place of business for the purpose of wholesale distribution
of prescription drugs must apply to the department for a license of
such business before beginning operation.
(g) Two or more places of business. If the wholesale
distributor of prescription drugs operates more than one place of
business, the wholesale distributor of prescription drugs must license
each place of business separately.
(h) Pre-licensing inspection. The applicant must cooperate
with any pre-licensing inspection by the department of the applicant's
place of business.
(i) Issuance of license. In accordance with §229.281
of this chapter (relating to Processing License/Permit Applications
Relating to Food and Drug Operations), the department may license
a wholesale distributor of prescription drugs who meets the requirements
of this subchapter and pays all license fees under §229.427 of
this subchapter (relating to Licensure Fees).
(j) Transfer of license. Licenses are not transferable
from one person to another or from one place of business to another.
(k) License term. Unless the license is amended as
provided in subsection (l) of this section or suspended or revoked
as provided in §229.428 of this subchapter (relating to Refusal,
Cancellation, Suspension, or Revocation of License), the license is
valid for two years.
(l) Amendment of license. A license that is amended,
including a change of name, or a notification of a change in the location
of a licensed place of business will require submission of an application
as outlined in §229.425 of this subchapter (relating to Licensing
Procedures) and submission of fees as outlined in §229.427 of
this subchapter.
(m) Renewal of license.
(1) The license application as outlined in §229.425
of this subchapter and nonrefundable licensing fees as outlined in §229.427
of this subchapter for each place of business must be submitted to
the department not later than the 30th day after the date the wholesale
distributor receives a renewal notification form from the department.
A person who files a renewal application after the expiration date
must pay an additional $100 as a delinquency fee.
(2) A license holder who fails to submit a renewal
application before the current licensure expiration date and continues
operations may be subject to the enforcement and penalty provisions
in §229.430 of this subchapter (relating to Enforcement and Penalties),
and the refusal, cancellation, suspension, and revocation provisions
in §229.428 of this subchapter.
(3) A renewal license is only issued when all past
due license fees and delinquency fees are paid.
(n) Bond.
(1) A wholesale distributor applying for or renewing
a license must submit, payable to this state, a bond or other equivalent
security acceptable to the department, including an irrevocable letter
of credit or a deposit in a trust account or financial institution,
in the amount of $100,000.
(2) The bond or equivalent security submitted under
paragraph (1) of this subsection must secure payment of any fines
or penalties imposed by the department or imposed in connection with
an enforcement action by the attorney general, any fees or other enforcement
costs, including attorney's fees payable to the attorney general,
and any other fees and costs incurred by this state related to that
license holder, authorized under the laws of this state and not paid
by the license holder before the 30th day after the date a fine, penalty,
fee, or cost is assessed.
(3) The department or this state may make a claim against
a bond or security submitted under paragraph (1) of this subsection
before the first anniversary of the date a license expires or is revoked
under this subchapter.
(4) The department must deposit the bonds and equivalent
securities received under this section in a separate account.
(5) A pharmacy warehouse not engaged in wholesale distribution
is exempt from the bond requirement under paragraph (1) of this subsection.
(6) A single bond is sufficient to cover all places
of business operated by a wholesale distributor in this state.
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