Health and Safety Code section 127692
(a)
The California Health and Human Services Agency (CHHSA) or its departments shall enter into partnerships, consistent with subdivision (b) of Section 127693, in consultation with other state departments as necessary, to increase competition, lower prices, and address shortages in the market for generic prescription drugs, to reduce the cost of prescription drugs for public and private purchasers, taxpayers, and consumers, and to increase patient access to affordable drugs.(b)
For purposes of implementing this chapter, CHHSA and its departments, including the Department of Health Care Access and Information, may enter into exclusive or nonexclusive contracts on a bid or negotiated basis. Contracts entered into or amended pursuant to this section are exempt from Chapter 6 (commencing with Section 14825) of Part 5.5 of Division 3 of Title 2 of the Government Code and Part 2 (commencing with Section 10100) of Division 2 of the Public Contract Code, and are exempt from the review or approval of any division of the Department of General Services. When appropriate, CHHSA shall establish initial and ongoing metrics to measure progress and efficiency, and remedies in the case those metrics are not met in any partnership contract entered into pursuant to this section.(c)
CHHSA shall have the ability to hire staff or contractors to oversee and project-manage the partnerships for manufacturing, procurement, or distribution of generic prescription drugs, contingent upon an appropriation by the Legislature for this purpose.(d)
It is the Legislature’s intent that any manufacturing partnership contract entered into pursuant to subdivision (b) is a partnership intended to create a California-branded label for generic drugs. It is further the Legislature’s intent that any manufacturing that is done under this section is intended to benefit the residents of this state by ensuring adequate supplies and access to generic prescription drugs and lowering health care costs through savings to public health care programs and private health insurance coverage.
Source:
Section 127692, https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=HSC§ionNum=127692. (accessed May 12, 2025).