New state law buckles down on wholesale drug distributors      

Mandates inspection before temporary license is issued

[JUNE 29, 2006]  SPRINGFIELD -- Gov. Rod R. Blagojevich signed a new law Tuesday mandating inspections of all wholesale drug distributors before temporary licenses are issued. The need for this legislation became clear when the Illinois Department of Financial and Professional Regulation found that safety guidelines were not followed by some wholesalers holding temporary licenses.

 Prior to the new law, a person who sent in an application to become a licensed wholesale drug distributor could use a copy of that application as a temporary license immediately -- without any inspection of the premises or review of the application by the Department of Financial and Professional Regulation. This left a gap in regulatory oversight, allowing unscrupulous drug distributors to distribute drugs that had been improperly stored and unsafe for public use.

"This law helps make sure that we not only inspect retailers, but wholesalers too. It's critical that everyone involved in the supply chain for prescription drugs meet all of the safety requirements," Blagojevich said.

In a case that demonstrated that a change was urgently needed, a distributor was shipping cough medicine that had been stored in his garage to retail drug store outlets. When the Illinois Department of Financial and Professional Regulation discovered what he was doing, the distributor closed down the corporation and filed a new application under a different name. With the new application, he was able to operate again for 90 days by posting the new application as a temporary license. Once the department had the opportunity to review his new application, it was denied and the department shut down his operations.

With the passage of Senate Bill 2909, there will be no opportunity for a similar situation to recur. The legislation was sponsored by Sen. Ira Silverstein, D-Chicago, and Rep. John Fritchey, D-Chicago.

"We expect our regulators to make sure pharmacies are inspected, and it only makes sense to ensure that the wholesalers they buy drugs from are also inspected," Silverstein said. "It is important that the supply chain is secure and that every prescription filled for Illinois consumers is as safe as we can make it." 

"This legislation will help ensure the availability of wholesale pharmaceuticals in our state, while at the same time protecting the health and safety of Illinois residents," Fritchey said.

The Federal Prescription Drug Marketing Act requires all states to establish wholesale drug distributor licensing with certain minimal regulations. This law establishes standards that exceed the federal requirements. The Illinois Department of Financial and Professional Regulation has five full-time pharmacy inspectors who already inspect each wholesale pharmacy before a permanent license is issued. With the implementation of this law, the inspections will be done before a temporary license is issued instead of when the permanent license is issued.

The new requirements outlined in this law take effect on Jan. 1, 2007.

[News release from the governor's office]