9.1 Introduction
Stock maintenance and management forms a key component of the effective delivery of pharmaceutical services. Inventory is commonly referred to as stocks in pharmacies and it is usually the duty of assistants to oversee the ordering, arrangement and maintenance of stocks, in order to meet patient and prescriber requirements.
Stock management or mismanagement has a significant impact on patient wellbeing and health outcomes. Non-availability of medication can adversely impact patient care and can prove to be fatal in hospital pharmacies, for example. Pharmacy stock management also impacts profitability, as it helps to maintain a healthy balance between under-stocking and over-stocking of products.
Pharmacy assistants can use either manual or automated, or a combination of both, to order new stocks for the pharmacy. In modern pharmacies, assistants use a handheld device to scan bar codes in order to check stocks. In addition, pharmacy workers can access the stock system of the wholesaler where they can directly place orders. Once received, new stocks should always be kept behind older stocks, because they have shorter expiration dates.
It is extremely important to verify the products received for quantity, quality and price. Products and packaging should not have been damaged or tampered with. In case you wish to return damaged or outdated products to the wholesaler, you must complete the necessary documentation in accordance with the policies stipulated in the agreement.
Expired or outdated medicines have to be discarded in the proper way. It is not a good idea to flush or throw away expired medications, because they may get introduced as environmental waste. The pharmacy may also receive expired medicines from patients and these must be stored in special waste containers, until they are collected for waste disposal by professional disposal companies.
9.2 Stock Management in Pharmacies
Pharmacy assistants are in charge of ordering, arranging and monitoring stocks. Inventory management in pharmacies refers to pharmaceutical products sold by the pharmacy. With a rise in the variety of pharmaceutical products available, stock management has become even more important for the optimisation of services.
From operational and financial perspectives, stock management plays a key role in improving efficiency in pharmaceutical settings. The underlying objective of effective inventory management is to reduce storage costs, whilst ensuring that there are adequate stocks available to meet patient and prescriber requirements. Non-availability of prescribed stocks can also have an adverse reaction on patient safety, especially if the medication is crucial to patient recovery.
Hospital pharmacies, for example, need to be particularly vigilant regarding critical medication and should ensure that they are consistently available. In addition to ensuring the availability of stocks, inventory management requires monitoring of stocks, in order to discard spoiled, expired or substandard products, which would also lead to adverse health outcomes. Pharmacy assistants are usually actively involved in inventory management and it is essential to understand the basics of stock management.
9.3 Inventory management
Inventory management is the process of organising, planning and controlling stocks, whilst balancing demand and supply. Inventory management in pharmacies aims at reducing carrying (storage) costs, whilst satisfying prescriber and patient requirements at the same time. Stock mismanagement can cause an imbalance in the supply and demand equation, as well as increase costs.
The primary objectives of pharmacy inventory management can be summarised as shown below:-
-Ensuring that adequate stocks of medicines and supplies are available.
-Reduction of carrying costs of excess inventory.
-Reduction of administrative time and effort in ordering and purchasing stocks (streamlining procedures).
Minimisation of costs associated with damage, as well as expiration of drugs. The products that are kept regularly in stock depend upon the size of the pharmacy and the number of patients handled each day. Medicines that are rarely used or bought may be ordered as and when needed.
However, regular products are usually purchased from preferred wholesalers and terms are stipulated in purchased contracts. It is important for pharmacy assistants to be familiar with preferred wholesale contracts, in order to help reduce acquisition costs.
Pharmacy Inventory Management Computer Systems
Many pharmacies use computer systems that help the workers process prescriptions, as well as track inventory. Several of the pharmacy systems are linked to the wholesaler's computer system and enable the assistant to view stocks and information regarding the required product directly on the wholesaler's system. All pharmacy assistants (or other pharmacy workers) are allocated usernames and passwords, in order to prevent unauthorised access to the stocks. It also helps the pharmacy owner or senior pharmacist to track errors, because the access indicates the identity of the assistant requesting stocks.
Perpetual Inventory Method
Most pharmacies in the UK follow a perpetual inventory method. The perpetual method of inventory management involves recording quantities of products as they are filled according to prescriptions. Whenever a prescription is filled and dispensed to patients, the quantity is reduced from the inventory. This way, the quantity of the product showing in the inventory is always current. Similarly, whenever returns and deliveries occur, the quantities automatically change in the inventory.
Computerised inventory systems allow pharmacy staff to generate manual and automated stock reports, which helps them to monitor stocks. Computerised stock systems are able to track stocks, predict drug requirements and identify errors. Pharmacies that use the perpetual inventory system are based on what is known as the PAR system or Periodic Automatic Replacement, or reorder points. In this system, the system will automatically order products when stocks are low.
Pharmacy workers can set the reorder points in accordance with the minimum level of stocks required in the pharmacy at a given time. Whenever the reorder point is reached, the computer system automatically orders fresh stocks to the maximum level required. In addition, modern inventory devices allow the assistant to scan the barcode and ID of the product directly into the inventory. Such devices can be effectively used for updating on-hand quantities, as well as for outdates and recalls.
9.4 Important Factors that influence Inventory Management in Pharmacies
Availability
The availability of medicines may vary according to different factors, including manufacturing, recalls and increase in demand. It is always a good idea to obtain information regarding alternative drugs and communicate this to patients, caregivers and so on.
Turnover Rates
Turnover rate plays an important role in managing inventory. The term turnover refers to the time that it takes for a product to get used up whilst on the pharmacy shelf. Pharmacy assistants should particularly focus on ensuring that medicines with a high turnover rate are ordered in time, to ensure availability to patients until the subsequent reorder date. However, drugs with low turnover rates should be maintained at minimum stock levels, to ensure that the expiration dates are reached before fresh stocks are ordered.
A pharmacy assistant should be well aware of the drugs that have high turnover rates and those that have low turnover rates. This will help you to reduce over-stocking of slow moving stock andminimise stock-outs of fast moving products. The location and services offered by the pharmacy will also play a crucial part in inventory management
For example
A pharmacy located near a paediatric clinic will have more stocks of medicines that are prescribed for children. Similarly, a pharmacy located next to a pain clinic will order more stocks of medicines related to pain management. Turnover rates may also be influenced by other factors, such as time of year (seasonality). For example, the assistant may have to order more stocks for anti-flu medications during the winter season, when people are more vulnerable to flu attacks.
Similarly, during the summer, anti-flu medications may be required less compared to anti-allergy medicines, as allergies tend to increase during warmer months. Hence, it is extremely important for pharmacy assistants to be aware of the patient requirements at the pharmacy and order stocks in accordance with those requirements.
Expiration rates
The expiration date refers to the date after which the medication should no longer be used. This is because over a period of time, the chemical structure of medicine may change and reduce the potency of the medication. Sometimes, the medicine may change into an entirely new product.
Medicines that approach their expiration dates must be removed from the shelves, because it is unsafe to dispense them to patients. Pharmacy assistants should make it a point to consider expiration dates, when ordering medicines. Please note that shelf life is different from expiry date. Shelf life refers to the period in which the medicine will retain its standard properties.
Similarly, near expired medications are those where there is less than one month remaining until expiration. Pharmacy workers should consider checking inventory every month, to rule out expired stocks. Hence, whilst ordering stocks, the assistant should not order more stocks than can be used in a year's time.
Activity
Estimated time: 10-15 minutes
Make a list of what medicines you would consider stocking up on just before the commencement of the winter season.
9.5 Inventory Terminology with regard to Pharmacy Products
Invoice
In the pharmacy setting, an invoice will contain a list of products ordered by the pharmacy, along with individual costs and total costs. It will also contain details of the wholesaler, the purchase order number and the pharmacy that has ordered the stocks.
Purchase Order
A purchase order will contain all of the medicines and supplies that the pharmacy wishes to order from the wholesaler. Each purchase order is assigned a number, which helps track the purchase order until the products are delivered to the pharmacy. The purchase order will also contain the name of the items, quantity, description and price, as well as the overall price.
Just in Time Ordering
Pharmacies that use this method order goods, as and when needed. This method minimises the likelihood of overstocking and tying up monetary resources in products that may sit for longer times on the shelf.
FACT
The number of pharmacies have grown by 18% in the UK, since 2005/2006.
Source: england.nhs.uk
9.6 Where to Order Pharmaceutical Supplies and Products
Pharmacy assistants should consider ordering products and medicines from wholesalers. Wholesalers purchase drugs directly from manufacturers and store them in large warehouses. Large retail pharmacy chains sometimes have their own warehouses and order products in large quantities. Smaller or independent pharmacies may order smaller quantities of products. Some drugs that involve high costs and low turnover, or that require special storage conditions, may be ordered from the manufacturer. However, it is better to order supplies from wholesalers, as they are more likely to offer preferred rates to customers (pharmacies).
9.7 How to Order Medications to Maintain Stocks
As the pharmacy caters to patients and fills prescriptions, its inventory of medicines and supplies is getting continuously depleted. The aim is to balance patients' needs with minimisation of overstocking, which could lead to expiry. Although stocks are now more or less automated in all UK based pharmacies, regular manual checks help the reduction of errors.
The pharmacy assistant needs to order products using the online ordering system. This system contains a list of all drugs, along with their numbers, names and package size. Wholesalers have their own ordering systems that classify products, in terms of turnover rates and other information. Pharmacies are able to access the database of products and directly order, according to their requirements. You may even be able to view images of the various medicines and supplies.
Online ordering system
Ordering of medications can be done automatically or manually. When a pharmacy assistant notices that a product is out of stock (or going to be out of stock very soon), he can order the item using the online ordering system. There are several methods that can help to determine the stocks that need to be ordered (this is called the visual method of counting stocks). The assistant can use a handheld device that scans the barcodes on products, or she can physically count the products on the shelves (if the pharmacy is small). However, counting may not be physically possible in large pharmacies that stock thousands of medicinal products on their shelves.
Some pharmacies have a “reorder card” for every medication. If the assistant notices that stocks need to be ordered, the reorder card will contain details of the quantity required and should be placed in the reorder section. A third method of stock evaluation is the sticker method, whereby the wholesaler provides different stickers for each medication. When the assistant needs to order stocks of a particular medication, the sticker is removed from the medicine and placed on the reorder sheet. The ordering sheet contains a list of items that are low on stocks and need to be ordered.
Some medicines may need to be ordered manually. Examples include emergency medicine and medicine that is used by only one or two patients (especially if they visit for repeat prescriptions).
Monitoring items
If you are ordering a drug manually, then you can consider scanning the barcode with a handheld scanning device and then searching for the product in the wholesaler database. Manual ordering of drugs can either be done on its own, or in combination with the automatic system. In the automated system, the computer calculates the number of items required to make up the minimal quantities and adds them to the order list.
However, it is always a good idea for assistants to monitor the items that the computer system is trying to order. Assistants should consider reviewing the medications identified by the automated system and checking to see if the quantities are correct. Once the order is complete, add a purchase order number, in order to make it easier to track. The purchase order must then be sent to the wholesaler (by email) and the pharmacy will then receive a confirmation. Wholesalers will normally deliver medicines to the pharmacy, depending on the agreement that they have.
Please remember to incorporate delivery times, when informing patients about estimated drug pickup times. Sometimes, the wholesaler may deliver equivalent substitutes for medications, upon unavailability of stock. In such situations, you must remember to cross-check substitutions with the pharmacist or the GP, before ordering the substitute.
For example
Some patients may specifically prefer a particular brand of medication. Sometimes, medications ordered by the pharmacy may not be available, because they have been discontinued.
Direct from the manufacturer
Pharmacy assistants may be required to order certain medications directly from the manufacturer (as opposed to the wholesaler). These are medications that may require special storage, or those that are not available at standard wholesalers. You may need to use order forms, or fax the request to the manufacturer directly. If you are ordering the drug for the first time, you may wish to enquire regarding any special ordering requirements. Orders that are placed directly may take longer to process, compared to orders placed with wholesalers. This factor must be carefully considered, when you advise the patient of drug pickup times. In general, shipments that are delivered directly by the manufacturer are called “drop shipments”. Frozen vaccinations are examples of drugs that pharmacy assistants order directly from the manufacturer.
9.8 How to receive Stocks at the Pharmacy
When stocks arrive at the pharmacy, you must verify that the delivery is satisfactory in all respects:-
-The quantity of boxes received should correspond with the quantity specified on the purchase order.
-Take a closer look at the packaging, to ensure that the package has not been opened beforehand.
-Once you have verified that the packaging is intact, open the box and check the contents for outdated or damaged products.
If you find that the products are outdated, damaged or unβit for usage, you should contact the wholesaler immediately, without delay. Also remember to keep such products separate from other pharmacy products, to prevent accidental use.
Tip: Chemotherapy medications should also be stored separately from other medications, as they are considered hazardous. Pharmacy workers should follow the procedures and regulations strictly, in order to prevent accidental exposure.
Similarly, if you receive controlled drugs, please inform the pharmacist immediately, for cross- checking and review of stocks. The stocks received at the pharmacy should also be accompanied by an invoice. The invoice will contain the name, strength, dosage and form of the medications that have been ordered. In addition, the invoice will contain the costs and quantity of each drug delivered. Lastly, the invoice also contains information regarding the wholesaler and the location of the pharmacy.
Once the quantity, price, strength, units, etc have been verified, the invoice should be signed and dated and stored for accounting purposes.
Tip: When arranging stock onto the shelves, make sure that you arrange new stocks behind the older ones. This way, the products with shorter expiration dates will get used up first.
Damaged or outdated goods
In case, you have received damaged or outdated goods, you must follow the set procedures that have been explained in the agreement with the wholesaler. You may also need to return some products to the wholesaler, if you have ordered products that you do not need - this can happen by mistake. The wholesaler will have specified the medications that can be returned for credit - and these can be returned in accordance with the policies.
Pharmacy assistants may be required to request credit before the products are sent back and the wholesaler will send the documentation to the pharmacy. The documentation should contain information regarding the purchase order number, item name and the quantity being returned. It will also contain the reason for the quantity being returned. When you return items to the wholesaler, they must be accompanied by this documentation and you must remember to keep a copy for the pharmacy records.
Errors may also occur due to the incorrect filing of the order at the wholesaler. Most wholesalers will send the required products in the next shipment and will accept any products that were sent in error (that the pharmacy did not order). You may need to fill in documentation, before sending the unwanted products back.
Activity
Estimated time: 10-15 minutes
Write some notes on how you would go about returning a box of medicines that arrived from the wholesaler with ripped packaging.
9.9 How to Process Outdated or Expired Medications
Pharmacies follow different rules and procedures for the disposal and processing of outdated medicines. Assistants should make it a point to check shelves regularly for expired and outdated medications, in order to minimise the medicines from reaching patients. It may be a good idea to mark the expiry date on coloured stickers, so that you are able to spot the expiry dates quickly. Ideally, medicines should be pulled off the shelves about two to three months before the expiry date.
The reason for this is simple - many patients are prescribed for 90 day periods. Hence, if you provide a medicine that is due to expire in, say, one month, it would have expired whilst the patient is still consuming the dosage. It is extremely important to dispose of expired or outdated medications, in order to prevent accidental usage or intentional misuse. Please bear in mind that wholesalers will only accept outdated or expired medication sent in with an order, within a certain window of time.
Outdated medicines should be kept separately from the rest of the products (to prevent accidental use) and should be packaged for return to the wholesaler. Many community pharmacies in the UK are also authorised to accept expired medicines from patients (but not from nursing homes and hospitals, which are expected to have their own medicine disposal process). When patients return expired medicine, you must separate them into solids (pills, tablets and so on), liquids (syrups, suspensions, emulsions) and aerosols (nasal sprays and so on). These expired and non-usable medicines should be stored in special waste containers that will be provided to the pharmacy by a waste contractor.
Expired medicine disposal is extremely important, as some medications are considered to be hazardous waste and should not be βlushed down the drain or discarded in the dustbin, as this will result in the introduction of dangerous medicines into the environment. Pharmacies have the option of hiring waste management companies, who manage the disposal of medicines using methods in accordance with UK environmental laws.
Some pharmacies may also use a “reverse distributor”, who collects damaged or expired medications from pharmacies. Reverse distributors will send the expired medications back to the manufacturer, along with the appropriate documentation, in order to collect credit. Some reverse distributors may charge a fee for their services. As assistant, you may be required to contact the reverse distributor for collection of expired medicines.
Recalls
Sometimes, a drug manufacturer can issue a recall, if a medicine is found to have an adverse effect on a patient's health. In such cases, the pharmacy will receive a message or email informing them regarding the drug recall. The assistant should then check the shelves carefully for the specific drug name and lot numbers and have them returned. The assistant should exercise special care, to keep the recalled product segregated from other products.
MODULE SUMMARY
Inventory management forms a significant part of the responsibilities of the pharmacy assistant. Careful inventory management can help to maximise patient outcomes, by ensuring availability of stocks and increase profitability by reducing costs. Whilst the general principles of inventory management remain consistent, the level of complexity may vary across pharmacies.
Stock management is a critical function from a financial as well as an operational perspective. It is usually the duty of the pharmacy assistant to monitor stocks and order fresh stocks, so as to reduce adverse impact on patient outcomes. Automated pharmacy inventory software orders fresh stocks, when the stocks fall below a certain level. However, it is a good idea for the assistant to cross-check the drugs that have been ordered by the system.
Inventory management in pharmacies involves the planning, organising and controlling of stocks, with a view to balancing demand and supply. All stock orders must be accompanied by purchase order numbers, which should contain crucial details such as item name, quantity, cost, units required and description. When the assistant receives the stock at the pharmacy, the products and packaging must be checked for damage and tampering. The assistant should match the delivery against the details provided in the purchase order.
Non-availability of pharmaceutical products may result in serious consequences. It is also crucial to check for expired and outdated medicines and dispose of them, before they reach patients. Regular checking helps to prevent accidental use and intentional misuse of expired medication. It is the duty of pharmacy assistants to perform regular checks, to ensure that expired medicines are segregated from other stocks.
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