§ 14124.46. — 14124.46. (Added November 5, 2024, by initiative Proposition 34, Sec. 1.)

Conclusions Regarding Compliance
(a)
(1)
Within 60 calendar days of the deadline established pursuant to subdivision (e) of Section 14124.45, the Attorney General, the California State Board of Pharmacy, the Department of Managed Health Care, and the State Department of Public Health shall each separately issue an independent written conclusion regarding whether or not the prescription drug price manipulator is in compliance with the requirements of Section 14124.44. Failure to reach a conclusion within 60 calendar days shall not excuse noncompliance with Section 14124.44.
(2)
The Attorney General, the California State Board of Pharmacy, the Department of Managed Health Care,
or the State Department of Public Health shall only be required to issue an independent written conclusion pursuant to this subdivision if the prescription drug price manipulator was required to submit information to the relevant official, board, or department pursuant to subdivision (a) of Section 14124.45.
(b)
(1)
If, within the 60-calendar day period set forth in paragraph (1) of subdivision (a), the information submitted by a prescription drug price manipulator is found to be incomplete or insufficient by the Attorney General, the California State Board of Pharmacy, the Department of Managed Health Care, or the State Department of Public Health for issuance of a written conclusion required by this section, then the relevant official, board, or department shall issue to the prescription drug price manipulator a written notice to correct. The notice to correct shall contain a description of the additional information
required.
(2)
The prescription drug price manipulator shall have 10-calendar days from the date of the notice to correct to provide complete or sufficient information. If the prescription drug price manipulator fails to remedy the incompleteness or insufficiency within 10-calendar days, then the prescription drug price manipulator shall be deemed to be out of compliance with the requirements of Section 14124.44 for the applicable calendar year and the relevant official, board, or department shall issue a written conclusion to that effect immediately upon the expiration of the 10-calendar-day period.
(c)
The Attorney General, the California State Board of Pharmacy, the Department of Managed Health Care, or the State Department of Public Health may, either collectively or separately, enter into an interagency agreement with the California State Auditor’s Office for assistance in
reaching a conclusion about a prescription drug price manipulator’s compliance with the requirements of Section 14124.44. Costs incurred pursuant to an interagency agreement under this subdivision may be recovered pursuant to subdivision (f) of Section 14124.45.
(d)
(1)
If the Attorney General, the California State Board of Pharmacy, the Department of Managed Health Care, or the State Department of Public Health concludes a prescription drug price manipulator is not in compliance with the requirements of Section 14124.44, then a written notice of noncompliance shall be provided to the prescription drug price manipulator notifying it of that conclusion. The written notice of noncompliance shall provide instructions on requesting a hearing pursuant to subdivision (e).
(2)
If a hearing is not requested pursuant to subdivision (e), then a conclusion issued
pursuant to this section shall become a final determination.
(e)
(1)
(A)
A prescription drug price manipulator may request a hearing in response to a written notice of noncompliance issued pursuant to paragraph (1) of subdivision (d).
(B)
The request shall be submitted in writing and must be made within 30-calendar days of the date of the written notice of noncompliance.
(2)
(A)
Except as otherwise provided in this article, hearings shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.
(B)
The Attorney General, the California State Board of Pharmacy, the Department of Managed Health Care, and the State
Department of Public Health may consolidate hearings on written notices of noncompliance pertaining to the same prescription drug price manipulator for the same calendar year and may mutually appoint a single hearing officer therefor. The hearing may be conducted by a hearing officer appointed by an official, board, or department that issued a written notice of noncompliance.
(C)
The prescription drug price manipulator may be represented by counsel at any of the stages of the proceedings.
(3)
(A)
If judicial review is not sought pursuant to subdivision (f), then the decision of the hearing officer shall become a final determination.
(B)
If the hearing officer’s decision is that the prescription drug price manipulator is not in compliance with the requirements of Section 14124.44, then any
exemption from California state taxation and any licenses described in subdivision (a) of Section 14124.45 held by the prescription drug price manipulator shall be immediately suspended. If judicial review is thereafter sought pursuant to subdivision (f), the state tax exemption and licenses shall remain suspended pending judicial review pursuant to subdivision (f).
(f)
(1)
Any party aggrieved by the decision of the hearing officer may seek review pursuant to Section 1094.5 of the Code of Civil Procedure within 30-calendar days of issuance of the hearing officer’s decision.
(2)
If review is sought pursuant to Section 1094.5 of the Code of Civil Procedure, the final determination shall be based upon the outcome of that review.

Legislative History

Added November 5, 2024, by initiative Proposition 34, Sec. 1. Effective December 18, 2024. Approved in Proposition 34 at the November 5, 2024, election. Operative January 1, 2025, pursuant to Section 14124.52.