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    3 Ways Technology Can Eliminate Pharmacy Inventory Management Issues in Healthcare Supply Chains

    Posted by: Valerie Bandy | February 14, 2023

    Inventory Management Issues in Healthcare Supply Chains

    I’ve worked in hospital pharmacies, as a pharmacist and consultant, for nearly two decades. While the foremost focus for pharmacy staff is their patients, as drug costs increase, reimbursements decrease and the list of shortages grows, they find themselves having to allocate more resources to supply management.

    There are two schools of thought on improving inventory management issues in healthcare supply chains: Throw more staff time at manual processes or automate them through a technology solution. At a time when hospitals struggle with pharmacy technician shortages (vacancy rates have more than tripled in the past three years — from 6% to 21%), automation is clearly the best approach. 

    Here are three ways pharmaceutical automation can help improve inventory management issues in healthcare supply chains for greater operational, clinical and financial performance.

    1. Maximize Pharmacy Staff Resources

    With pharmacy technicians in short supply, hospital pharmacists have found themselves taking on tasks that would normally be handled by technicians. In an American Society of Health-System (ASHP) survey, 89% of pharmacy executives said that pharmacists were asked to perform technician duties.

    Pharmaceutical supply management varies widely from one hospital to the next. I have seen hospitals where the pharmacy has a dedicated buyer, or someone dedicated to purchasing on their leadership team. But in most cases, the person handling supply management is juggling competing priorities, from drug diversion to staffing, with supply management often taking a back seat to more patient-facing or high-profile priorities.

    Automated drug tracking and management from receipt through use means hospital pharmacies can allocate less manual labor to inventory management tasks, while gaining visibility to the drugs they have in stock and data to inform purchasing. Pharmacists can work at top of their licensure with a focus on strategic supply decisions, enabling hospitals to maximize these valuable staff resources. 

    2. Manage Supplies More Effectively to Reduce Waste

    With patients as the priority, pharmacy teams will do whatever it takes to ensure drug products are available when needed. Unfortunately, in hospital pharmacies with little visibility to on-hand inventory, this often leads to over-ordering and unused products expiring on the shelves. The ramifications of drug product expiry range from unnecessary costs to the risk that an expired item will be used on a patient. 

    Case in point: I worked in a 100+-year-old hospital that could not house a carousel because the weight of the floor couldn’t hold it. The only technology we had for drug inventory management was automated dispensing machines, so anything on the shelves had to be managed manually. As a result, we were overflowing with products we didn’t need.

    We had a very savvy buyer, but the technology limitations left her having to put stickers on shelves (e.g., “don’t buy any more than 20 of this item” and “don’t let the count fall below 10”). To gauge par levels, she would have to manually count and compile data from the dispensing machines, shelves and overflow locations. By the time we got a complete count, the information was already outdated. This manual process barely put a dent in the global view of the on-hand inventory and is only a fraction of the inventory management issues in healthcare supply chains.

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    Even in hospitals that are better equipped from a technology perspective, with point solutions to manage different categories of drug products (e.g., carousel, IV dispensing software, etc.), those that do not have an overarching supply chain management (SCM) solution that is fully integrated with these disparate systems must jump through hoops to get accurate inventory counts. 

    With a fully integrated, enterprise-wide SCM solution that tracks drug products from receipt through dispensing, pharmacy staff members have real-time, accurate and complete information on all supply inventory at their fingertips to order what they need, when they need it.

    3. Improve Patient Care and Safety 

    In a recent ASHP survey, more than 99% of respondents said that they had been affected by the scarcity of critical drugs. Hospital pharmacies that have little visibility to drug inventory are vulnerable to running low on products or completely running out. In cases where there are no alternate drugs to purchase, pharmacists and clinicians must find some way to manage patients that need the unavailable medication. 

    Those that have SCM technology to effectively manage par levels, keeping on hand what they need and managing drugs by first-in, first-out usage to avoid expiry and waste, are less likely to run out of a critical drug during a shortage situation. The SCM solution provides real-time data on inventory levels and product consumption so they can perform predictive analytics to guide purchasing decisions. In this way, effective supply management supports continuity of care and reduces further inventory management issues in the healthcare supply chain. 

    A Note on True Automation

    It is important to differentiate true supply automation through an enterprise-wide platform integrated with key systems (e.g., pharmacy information systems, financial systems) from the patchwork of standalone solutions that many hospital pharmacies use today. If pharmacy staff members find themselves having to key product data into different IT systems to bridge tracking gaps from product receipt through use, then their processes really aren’t automated. 

    An automated drug supply management approach should relieve staff from manual tasks by connecting all the links in the hospital supply chain, facilitating data capture via barcode or RFID scanning, and populating integrated systems with the required data on the product tracked. It should provide pharmacy and hospital leaders with a single view into all drug inventory including medications in transit or stored inside automation technologies such as carousels and dispensing cabinets.

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