Puerto Rico Implements Licensure Requirement for Non-Resident Wholesalers & Manufacturers
Health & Life Sciences 08/01/22 Christopher Guthrie, Monica Wright, Susan Trujillo, Brenda Maloney Shafer, Roger Morris
While the vast majority of states require non-resident wholesale distributors and manufacturers that ship prescription drugs into their states to obtain a non-resident license, Puerto Rico had been one of the few that did not have such a requirement. This has now changed. Effective July 1, 2022, Puerto Rico began requiring all non-resident wholesale distributors and manufacturers that ship prescription and over-the-counter human and veterinary drugs, medical devices, and homeopathic and nutritional supplements into the Commonwealth to obtain a non-resident license, called a “Special Authorization”. The Puerto Rico Auxiliary Secretariat for Regulation and Accreditation of Health Facilities (“SARAFS”), the agency responsible for issuing the special authorizations, has not yet provided guidance as to whether third-party logistics providers are also subject to this new licensure requirement.
SARAFS released a notification regarding this new requirement on June 29, 2022, which summarizes the regulatory basis for the licensure requirement and details the application process. The notice directs the previously identified non-resident facilities to complete the application process via the Online Renewals Portal, which can be found here. When submitting the online application, each applicant must also complete and upload the following forms, which are available on the portal: Self-Certification of Compliance; Clear Criminal History Record of Non-Resident Distributors; Certification of Compliance with Drugs Registration; and Certification of Bond. The special authorization will be valid for two years, after which it can be renewed.
Though the new regulation went into effect on July 1, 2022, SARAFS has indicated that non-resident wholesalers and manufacturers that are currently shipping products into Puerto Rico may continue to do so until they receive their new special authorization; however, facilities that are not yet shipping into Puerto Rico must first obtain the special authorization before commencing distributions. Upon receiving the special authorization, licensees must ensure compliance with the provisions of the Puerto Rico Pharmacy Law, 20 L.P.R.A. § 410 et seq, and its applicable regulations, including those related to storage, handling, recordkeeping, personnel, and annual reporting. If the Drugs and Pharmacy Division of SARAFS believes that a non-resident facility is not operating in compliance with these regulations, SARAFS may also inspect the facility at the facility’s expense. If non-compliance is found, SARAFS may levy fines, revoke the special authorization, or execute the required bond.
This new non-resident licensure requirement does not replace the existing requirement for non-resident wholesale distributors and manufacturers to register certain products shipped into Puerto Rico, but is instead a supplement to that requirement. In fact, SARAFS issued a second notice regarding a change in the process for non-resident wholesale distributors, manufacturers, and their agents to register the products shipped into Puerto Rico. Per the notice, a new portal for wholesaler distributors, manufacturers, and their agents to register the products that they ship into the Commonwealth was initially set to launch on June 30, 2022. However, there have been delays with the portal and the launch date has been pushed back to August 15, 2022.
Importantly, non-resident pharmacies are still not required to obtain any sort of non-resident license or special authorization, nor are they required to register products shipped to a patient in Puerto Rico pursuant to a valid prescription. See National Pharmacies, Inc. v. Feliciano-de-Melecio, 221 F.3d 235, 242 (2000); Reglamento de la Secretaria de Salud Núm. 156, Article 3.03(a).
Quarles & Brady attorneys will be monitoring the implementation of both the licensure and product registration requirements and will continue to provide updates. If you have any questions, please contact your Quarles & Brady attorney or: