On September 28, 2012, Governor Brown announced the signing of AB 1442, which has potentially important implications for entities handling pharmaceutical items, including pharmacies, retailers, groceries, hospitals, medical clinics, and other such facilities which handle pharmaceutical and over-the-counter (OTC) drugs. AB 1442 comes at a time when increased attention is being paid to the disposition and handling of these pharmaceutical items both in California and nationally, including the EPA's recently renewed efforts to establish standards for the handling and disposal of hazardous waste pharmaceuticals.
The law amends California's Medical Waste Management Act (MWMA) to provide relief from some of the MWMA's onerous requirements pertaining to the handling of certain pharmaceutical items (which, as explained below, includes prescription and over-the-counter drugs). This includes requirements that, as interpreted by California enforcement authorities, had the practical effect of limiting the ability of entities handling pharmaceutical items to send certain of these items into reverse distribution for credit and liquidation, refurbishing, repurposing, or other responsible reprocessing, as opposed to disposal.
Specifically, enforcement authorities have typically interpreted the MWMA and other applicable laws as requiring regulated entities to determine whether a pharmaceutical item is a waste. Because the waste determination process is nuanced and the potential legal consequences of mischaracterizing a waste item as non-waste are severe, many regulated entities understandably take the conservative approach of disposing of many pharmaceutical items as waste at the store level, even where such items could have reasonably been sent through reverse distribution for credit and/or for a non-waste disposition. Based on our communications with multiple individuals involved in drafting the bill, AB 1442 is intended to at least partially address these concerns. The most salient components of AB 1442 include the following:
1. AB 1442 defines "pharmaceutical waste," which was previously undefined under the MWMA, as "any pharmaceutical, as defined in, that is a waste, as defined in 25124." The MWMA continues to define "pharmaceutical" as any prescription or over-the-counter drug, excluding any such drug that is regulated pursuant to the federal Resource Conservation and Recovery Act ("RCRA") or the California Radiation Control Law. Accordingly, because the provisions described below apply only to pharmaceuticals and pharmaceutical waste as defined by the MWMA, the benefits of AB 1442 do not extend to any prescription or over-the-counter items that would be RCRA-hazardous waste if disposed.
2. AB 1442 permits a pharmaceutical waste generator to (a) self-transport its pharmaceutical waste to another facility for consolidation prior to treatment and disposal or (b) contract with a common carrier to transport its pharmaceutical waste "to a permitted medical waste treatment facility or transfer station." Each of these activities is subject to prescribed registration, recordkeeping, and other administrative requirements. This provision expands on an existing provision under the MWMA that enables generators of medical waste (including pharmaceutical waste) to "apply to the enforcement agency for a limited-quantity hauling exemption" to self-transport its medical waste for both consolidation and disposal. The apparent effect of this provision is that the self-transport of pharmaceutical waste from the initial generator to a distribution center may be permissible, provided the waste generator has otherwise complied with the prescribed administrative requirements. Note that, for the reasons described in the following paragraph, this provision appears to be moot with respect to a pharmaceutical item being sent into reverse distribution.
3. AB 1442 exempts from the definition of "pharmaceutical waste" any pharmaceutical that "is being sent" to a properly licensed "reverse distributor," provided that if the reverse distributor is located in California, it must also be a permitted transfer station. The self-transport/common carrier provision described in the preceding paragraph would therefore appear to be moot with respect to a pharmaceutical sent to a reverse distributor in accordance with this exemption given that, based on our communications with individuals involved in drafting AB 1442, this exemption is intended to apply to pharmaceuticals throughout the reverse distribution process, including while such items are awaiting shipment at a store or distribution center, during transportation to a distribution center for interim processing, and/or during transportation to the reverse distributor. This provision appears to enable regulated entities to send all "pharmaceuticals" into reverse distribution, regardless of whether or not such items are a waste, for characterization by the reverse distributor and credit, disposal, or other non-waste disposition, as applicable. Note, however, that the exemption applies only where the pharmaceutical is being sent to a reverse distributor that satisfies the requirements set forth in AB 1442.
Taking full advantage of the benefits of AB 1442 will likely require adjustments to most regulated entities’ waste management programs because, among other things, AB 1442 does not apply to any prescription or over-the-counter items that would be RCRA-hazardous waste if disposed. Accordingly, it will be necessary to develop, roll out, and train personnel to implement a program for distinguishing and segregating RCRA-hazardous pharmacy waste from pharmaceutical wastes not regulated by RCRA.
Notwithstanding the drafters' stated intent with respect to AB 1442, the language of the bill as interpreted by enforcement authorities and the courts will ultimately determine the usefulness of AB 1442 to the regulated community.
Ted Wolff is a partner in Manatt, Phelps & Phillips’ New York office and focuses his environmental practice on litigation and transactional work. He regularly counsels clients on compliance with environmental laws, including those that regulate the handling, storage, treatment and disposal of hazardous substances and waste. Mr. Wolff can be reached at (212) 790-4575 or twolff@manatt.com.
Matthew Dombroski is an associate with Manatt, Phelps & Phillips in New York and regularly counsels clients on environmental matters relating to corporate and regulatory compliance. Mr. Dombroski can be reached at (212) 790-4556 or mdombroski@manatt.com.
This column is part of a series of articles by law firm Manatt, Phelps & Phillips, LLP’s Energy, Environment & Natural Resources practice. Earlier columns have discussed Green Chemistry Regulation, The Case for Dam Removal, Sustainable/Energy Retrofits of Commercial Buildings, Demand-Response and Energy Efficiency Programs, California’s Cap and Trade Program, Demise of Redevelopment in California, What’s Next for the Renewable Power Industry and Renewable Energy Projects On Tribal Lands.
