AB208 - Restricts the use of certain products by governmental entities and government-funded entities. (BDR 19-737)

EXEMPT (Reprinted with amendments adopted on April 18, 2025) FIRST REPRINT A.B. 208 - *AB208_R1* ASSEMBLY BILL NO. 208–ASSEMBLYMEMBER YEAGER PREFILED FEBRUARY 3, 2025 ____________ Referred to Committee on Government Affairs SUMMARY—Restricts the use of certain products by governmental entities and government-funded entities. (BDR 19-737) FISCAL NOTE: Effect on Local Government: May have Fiscal Impact. Effect on the State: Yes. ~ EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. AN ACT relating to governmental entities; restricting the manner in which certain governmental entities or government- funded entities may use certain products; providing certain exceptions; and providing other matters properly relating thereto. Legislative Counsel’s Digest: This bill prohibits, with certain exceptions, a governmental entity or a 1 government-funded entity that operates, administers or contracts with a mental 2 health facility or place of confinement from using a product that is or has ever been 3 protected by a patent granted by the United States Patent and Trademark Office or is 4 subject to review by certain federal agencies in a manner: (1) that is contrary to the 5 terms of use of that product established by the current or most recent holder of the 6 patent for the product or the manufacturer or distributor of the product; (2) that is 7 inconsistent with any written instructions, limitations or directed uses included with 8 the product; or (3) that exceeds the scope of the approved usage of the product, if a 9 federal agency has approved the product for specific uses. This bill also prohibits 10 such a governmental entity or government-funded entity from providing or 11 dispensing such a product for use in such a manner. 12 However, this bill authorizes a covered entity to use, provide or dispense a 13 product in such a manner if the covered entity transmits a written notice of the 14 intended use to the patent holder and the manufacturer or distributor of the product, 15 if different from the patent holder, that: (1) identifies the specific product at issue; 16 and (2) describes the specific manner in which the entity plans to use, provide or 17 dispense the product. This bill authorizes the patent holder or the manufacturer or 18 distributor of a product to object to the use, provision or dispensing of the product 19 in such a manner by transmitting a written notice of the objection to the covered 20 entity. Once the covered entity receives a notice of objection from the patent 21 holder, manufacturer or distributor, this bill requires the covered entity to cease and 22 desist from using, providing or dispensing the product in the manner to which the 23 – 2 – - *AB208_R1* patent holder, manufacturer or distributor objects. This bill further authorizes a 24 covered entity to provide or dispense a patented or reviewed product to a resident 25 of a mental health facility or place of confinement to be used in a non-conforming 26 manner without providing notice to the patent holder, manufacturer and distributor 27 of the product if the resident to whom the product is provided or dispensed provides 28 informed consent with respect to the use and receipt of the product. 29 THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS: Section 1. Chapter 237 of NRS is hereby amended by adding 1 thereto a new section to read as follows: 2 1. Except as authorized by this section, a covered entity shall 3 not use a federally reviewed product or provide or dispense a 4 federally reviewed product to a resident for use, regardless of how 5 the product was obtained, in a manner that: 6 (a) Is contrary to the terms of use established for the federally 7 reviewed product by the patent holder, manufacturer or 8 distributor; 9 (b) Is inconsistent with any written directions, instructions, 10 limitations or intended usages for the federally reviewed product 11 that: 12 (1) Accompany the product; 13 (2) Are printed on the product; or 14 (3) Are printed on any label or packaging for the product; 15 or 16 (c) Is not one of the approved uses or purposes of the federally 17 reviewed product, if the product is approved for specific uses or 18 purposes by an agency of the Federal Government. 19 2. Except as otherwise provided by subsection 5, a covered 20 entity may use, provide or dispense a federally reviewed product in 21 a manner described in subsection 1 if: 22 (a) The covered entity transmits a written notice to the patent 23 holder and the manufacturer and distributor of the federally 24 reviewed product, if different from the patent holder, that: 25 (1) Sufficiently identifies the federally reviewed product 26 that the covered entity seeks to use, provide or dispense; and 27 (2) Describes the specific manner in or purposes for which 28 the covered entity plans to use, provide or dispense the federally 29 reviewed product; and 30 (b) At least 30 days have elapsed after the transmission of the 31 notice described in paragraph (a) without the patent holder, 32 manufacturer or distributor of the federally reviewed product 33 transmitting an objection to the covered entity pursuant to 34 subsection 3. 35 – 3 – - *AB208_R1* 3. If a patent holder or a manufacturer or distributor of a 1 federally reviewed product has reason to believe that a covered 2 entity is using, providing or dispensing or plans to use, provide or 3 dispense a federally reviewed product in a manner described in 4 subsection 1, based on a notice received pursuant to subsection 2 5 or for any other reason, the patent holder, manufacturer or 6 distributor may object to such use by transmitting a written notice 7 to the covered entity that: 8 (a) Identifies the federally reviewed product at issue; 9 (b) Specifically describes the manner of use of the federally 10 reviewed product to which the patent holder, manufacturer or 11 distributor, as applicable, objects; 12 (c) Explains the reasons that the patent holder, manufacturer 13 or distributor believes such manner of use of the federally 14 reviewed product violates subsection 1; and 15 (d) Requests that the covered entity cease and desist from 16 using, providing or dispensing the federally reviewed product in 17 the manner described in paragraph (b). 18 4. A patent holder or a manufacturer or distributor of a 19 federally reviewed product may withdraw an objection made 20 pursuant to subsection 3 by transmitting a written notice to the 21 covered entity to which the patent holder, manufacturer or 22 distributor, as applicable, transmitted the objection pursuant to 23 subsection 3. The notice must identify: 24 (a) The federally reviewed product at issue; and 25 (b) The manner of use of the federally reviewed product 26 described in paragraph (b) of subsection 3 to which the patent 27 holder, manufacturer or distributor, as applicable, no longer 28 objects. 29 5. Except as otherwise provided in this subsection and 30 subsection 6, upon receiving a written notice described in 31 subsection 3 from a patent holder or the manufacturer or 32 distributor of a federally reviewed product, a covered entity shall 33 immediately cease and desist from using, providing or dispensing 34 the federally reviewed product in the manner described in the 35 notice pursuant to paragraph (b) of subsection 3. A covered entity 36 may use, provide or dispense the federally reviewed product in 37 such a manner if the covered entity subsequently receives a written 38 notice withdrawing any objection for that particular manner of 39 use pursuant to subsection 4 from all patent holders, 40 manufacturers and distributors that have objected to that 41 particular manner of use pursuant to subsection 3. 42 6. A covered entity may provide or dispense a federally 43 reviewed product to a resident to be used in a manner described in 44 subsection 1 if the resident to whom the product is provided or 45 – 4 – - *AB208_R1* dispensed provides informed consent to the covered entity with 1 respect to the particular use and receipt of the product. A covered 2 entity is not required to provide the notice required pursuant to 3 subsection 2 to the patent holder, manufacturer and distributor of 4 a federally reviewed product that is provided or dispensed in a 5 manner consistent with the provisions of this subsection. 6 7. The provisions of this section shall not be construed to 7 require a covered entity to perform any action or use, provide or 8 dispense a federally reviewed product in a manner that is in 9 violation of any condition to the receipt of federal money. 10 8. As used in this section: 11 (a) “Covered entity” means: 12 (1) A governmental entity that operates or administers a 13 covered facility; and 14 (2) A government-funded entity that: 15 (I) Maintains a contract with a governmental entity to 16 provide services in or assist in the operations of a covered facility; 17 or 18 (II) Operates or administers a covered facility. 19 (b) “Covered facility” means: 20 (1) A facility that provides care, treatment or training of 21 consumers and persons with mental illnesses, including, without 22 limitation, the facilities listed in NRS 433.233 and 433B.110; or 23 (2) A community correctional center, conservation camp, 24 facility of minimum security, prison or other place of confinement 25 for the custody, care or training of persons sentenced to 26 imprisonment. 27 (c) “Federally reviewed product” means any product or 28 invention that: 29 (1) Is currently protected by, or has ever been protected by, 30 a patent issued by the United States Patent and Trademark Office; 31 and 32 (2) Has received or is pending approval by the United 33 States Food and Drug Administration or the United States 34 Department of Agriculture. 35 (d) “Governmental entity” means the State of Nevada or any 36 agency, institution, board, commission, bureau, council, 37 department, division, office, authority or other unit of government 38 of the State of Nevada. 39 (e) “Government-funded entity” means any entity that received 40 50 percent or more of its operating budget in the immediately 41 preceding calendar year from any combination of: 42 (1) One or more governmental entities; or 43 (2) Appropriations, grants or transfers from the State 44 General Fund or any other fund or account established by law. 45 – 5 – - *AB208_R1* (f) “Patent holder” means: 1 (1) A person or entity that holds a valid patent for a 2 federally reviewed product issued by the United States Patent and 3 Trademark Office; or 4 (2) If the patent issued by the United States Patent and 5 Trademark Office for a federally approved product is expired, the 6 person or entity that held the patent at the time of the expiration. 7 (g) “Resident” means a person who is ordered into the custody 8 of, confined in or otherwise resides within a covered facility. 9 Sec. 2. 1. This section becomes effective upon passage and 10 approval. 11 2. Section 1 of this act becomes effective: 12 (a) Upon passage and approval for the purpose of adopting any 13 regulations and performing any other preparatory administrative 14 tasks that are necessary to carry out the provisions of this act; and 15 (b) On July 1, 2025, for all other purposes. 16 H