A

SPECIALIZATION PROJECT REPORT

ON

MEDICAL STORES INVENTORY CONTROL

UNDER THE GUIDANCE OF

PROF.SHALINI KAKKAR.

SUBMITTED TO THE UNIVERSITY OF MUMBAI

IN PARTIAL FULLFILLMENT OF 2 YEARS FULL TIME

COURSE MASTER OF MANAGEMENT STUDIES (MMS)

SUBMITTED BY

SAURABH SALVI

(Roll no: Operations-09)

(BATCH 2016-18)

PTVA’S Institute Of Management Studies

Mumbai.

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This is to certify that project titled is successfully completed by Mr. Saurabh Salvi. during the IV
semester, in partial fulfillment of the Master’s Degree in Management Studies recognized by the
University of Mumbai for the Academic Year 2017-18 through The project is original work and
not submitted earlier for the award of any degree/ diploma/ or associate ship of any other
University/Institution.

Name: Prof. Shalini Kakkar. Dr. Harish Kumar S. Purohit

Signature of the guide Director

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 DECLARATION

I hereby declare that this Project Report submitted by me to the ParleTilakVidyalaya

Association’s Institute of Management is a bonafide work undertaken by me and is not
submitted to any other University or Institute for the award of any degree diploma/certificate or
published any time before.

Name: Saurabh Salvi.

Roll No: Operations-09 (Signature of the guide)

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 ACKNOWLEDGEMENTS

First and foremost, I would like to express my gratitude to the Almighty, the omnipresent and
omnipotent, who kept me in good health and provided me with the wisdom to complete this task
in a properly and timely manner. The accomplishment of this study has been made possible by
the generous consideration of the people at SAMARTH MEDICAL STORE,RATNAGIRI.
and I am happy that I am given this opportunity to express my gratitude towards these good
people .I would like to acknowledge the valuable work experience I received during my project
data collection. I will be forever indebted for the guidance & constant supervision provided to
me by my mentor Mr. Sudesh Prasade for giving inputs of necessary information for this
project.

I would like to express my sincere gratitude towards my mentor at PTVA’s Institute of

Management, Mrs. Shalini Kakkar for taking the time to review my progress and provide
valuable feedback throughout the course of my internship. She provided me with suggestions on
how to improve my report & what corrections were needed which proved to be quite valuable.
Finally, I express my gratitude to my parents for their support and encouragement throughout
this project.

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 TABLE OF CONTENTS

Chapter No. Particulars Page No.

1 Executive summary 1

2 Introduction 2

3 Importance of Logistics 6

4 Literature Review 12

5 Research Methodology 13

6 Results 14

7 Discussion 15

8 Conclusion 35

9 Bibliography 37

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 LIST OF FIGURES

SR NO TITLE PAGE NO.

1 Sector overview 17

2 Healthcare sector 13

3 Stock percentage 18

4 Medicine rack 28

5 Stock levels 30

6 Drug recall 31

7 Expired drugs 33

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 1. EXECUTIVE SUMMARY

Shree Samarth Medical centre is a General Health clinic in Ratnagiri. The clinic is visited by
general physicians like Dr. Jagdish Lawangare.

The timings of Shree Samarth Medical centre are: Mon to Sat: 10:00 AM-2:00 PM, 6:00
PM-10:00 PM.

Some of the services provided by the clinic are: Fever Treatment, Infectious Disease
Treatment, General Medical Consultation, ECG and Vaccination/ Immunization. Click on
map to find directions to reach Shree Samarth Medical centre.

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 2.INTRODUCTION

Inventory control is the processes employed to maximize a company's use of inventory. The
goal of inventory control is to generate the maximum profit from the least amount of inventory
investment without intruding upon customer satisfaction levels. Given the impact on customers
and profits, inventory control is one of the chief concerns of businesses t hat have large
inventory investments, such as retailers and distributors. Some of the more common areas in
which to exercise inventory control are:

 Raw materials availability. There must be enough raw materials inventory on hand to ensure that
new jobs are launched in the production process in a timely manner, but not so much that the
company is investing in an inordinate amount of inventory. The key control designed to address
this balance is ordering frequently in small lot sizes from suppliers. Few suppliers are willing to
do this, given the cost of frequent deliveries, so a company may have to engage in sole sourcing
of goods in order to entice suppliers into engaging in just-in-time deliveries.

 Finished goods availability. A company may be able to charge a higher price for its products if it
can reliably ship them to customers at once. Thus, there may be a pricing premium associated
with having high levels of finished goods on hand. However, the cost of investing in so much
inventory may exceed the profits to be gained from doing so, so inventory control involves
balancing the proportion of allowable backorders with a reduced level of on-hand finished
goods. This may also lead to the use of a just-in-time manufacturing system, which only
produces goods to specific customer orders (which nearly eliminates inventory levels).

 Work in process. It is possible to reduce the amount of inventory that is being worked on in the
production process, which further reduces the inventory investment. This can involve a broad
array of actions, such as using production cells to work on subassemblies, shifting the work area
into a smaller space to reduce the amount of inventory travel time, reducing machine setup
times to switch to new jobs, and minimizing job sizes.

 Reorder point. A key part of inventory control is deciding upon the best inventory level at
which to reorder additional inventory. If the reorder level is set very low, this keeps the
investment in inventory low, but also increases the risk of a stock out, which m ay interfere
with the production process or sales to customers. The reverse problems arise if the reorder
point is set too high. There can be a considerable amount of ongoing adjustment to reorder

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 levels to fine tune these issues. An alternative method is to use a material requirements
planning system to order only enough inventory for expected production levels.
 Bottleneck enhancement. There is nearly always a bottleneck somewhere in the production
process that interferes with the ability of the entire operation to increase its output. Inventory
control can involve placing an inventory buffer immediately in front of the bottleneck
operation, so that the bottleneck can keep running even if there are production failures
upstream from it that would otherwise interfere with any inputs that it requires.

 Outsourcing. Inventory control can also involve decisions to outsource some activities to
suppliers, thereby shifting the inventory control burden to the suppliers (though usually in
exchange for a reduced level of profitability).

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2.1 SECTOR OVERVIEW

The healthcare industry (also called the medical industry or health economy) is the range of
companies and non-profit organizations that provide medical services, manufacture medical
equipment, and develop pharmaceuticals. It includes the generation and commercialization
of goods and services lending themselves to maintaining and re-establishing health. The
modern healthcare industry is divided into many sectors and depends on interdisciplinary
teams of trained professionals and paraprofessionals to meet health needs of individuals and
populations.
The healthcare industry is one of the world's largest and fastest-growing industries.
Consuming over 10 percent of gross domestic product (GDP) of most developed nations,
health care can form an enormous part of a country's economy.
Health care in the United States is given by numerous different legitimate elements. Current
evaluations put US healthcare spending at around 15% of GDP, which is the most astounding
on the planet. The United States spends the most noteworthy level of health care costs on
pharmaceuticals on the planet. In the United States, around 85% of residents have health
protection, either through their manager or bought exclusively.

Fig.1 Sector overview

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Market Size
India has predicted that with increased digital adoption, the Indian healthcare market, which
is worth around US$ 100 billion, will likely grow at a CAGR of 23 per cent to US$ 280 billion by
2020. The healthcare market can increase three fold to US$ 372 billion by 2022.
India is experiencing 22-25 per cent growth in medical tourism and the industry is expected to
double its size from present (April 2017) US$ 3 billion to US$ 6 billion by 2018. Medical tourist
arrivals in India increased more than 50 per cent to 200,000 in 2016 from 130,000 in 2015.
The Healthcare Information Technology (IT) market is valued at US$ 1 billion currently (April
2016) and is expected to grow 1.5 times by 2020. #
Over 80 per cent of the antiretroviral drugs used globally to combat AIDS (Acquired
Immuno Deficiency Syndrome) are supplied by Indian pharmaceutical firms^.
There is a significant scope for enhancing healthcare services considering that healthcare
spending as a percentage of Gross Domestic Product (GDP) is rising. Rural India, which accounts
for over 70 per cent of the population, is set to emerge as a potential demand source.
A total of 3,598 hospitals and 25,723 dispensaries across the country offer AYUSH (Ayurveda,
Yoga & Naturopathy, Unani, Siddha and Homoeopathy) treatment, thus ensuring availability of
alternative medicine and treatment to the people. In 2017, the Government of India has
provided grant-in-aid for setting up of AYUSH educational institutions in States and Union
Territories.

Fig.1.2 Healthcare sector

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 3. LITERATURE REVIEW

1.Information Science and Technology (CiSt), 2016 4th IEEE

International Colloquium on
Nowadays, scientific researches attribute a crucial importance to hospital sector. The
improvement of this sector is considered by the literature as strongly depending on well mastered
hospital supply chain, more exactly drug supply chain. Hence, several research studies have
worked on the management of drug supply chain by offering diverse approaches and
management models. In this paper, we focus on stochastic drug supply chain and our goal is to
present a literature review about the drug supply chain and drug supply and inventory
management methods, in order to establish a comparative analysis of the methods and approaches
recently proposed by various research projects to identify the most appropriate one. Drug supply
chain management is becoming more difficult and complex, despite their dedicated high
budget. Indeed, this can be explained by the continued increasing number of patients and
the many stochastic events either internal uncertainties in care units activity external ones
in patients needs changes and unanticipated behavior of providers. Moreover, supply and
inventory management problems are making the stochastic effect more serious. Whole of
these factors are affecting hospital service level and generating a very high logistic
management cost. So a well organized and effective supply and inventory management,
in addition to mastered stochastic events, will be the high-performance solution.

1. Survey of drug inventory control process and performance among

hospital pharmacy departments

Cost analysis plays a pivotal role in the management of pharmacy store. About one-third of the
hospital budget is spent on purchasing materials and supplies including medicines. The
pharmacy is one of the most extensively used therapeutic facilities of the hospital and one of the
few areas where a large amount of money is spent on buying items. To explore the feasibility of
alphabetical analysis where items are classified into A, B and C categories depending on their
annual consumption value, in effective management of pharmacy store. A study suggested that
review for expensive drugs could bring out 20% savings in pharmacy store budget. The goal of
inventory management involves having to balance the conflicting economics of not wanting to
hold too much stock. The inventory management can bring out significant improvement not
only in patient care but also in the optimal use of resources. Continuous management can
provide the value added services to the patients.

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 4.OBJECTIVES OF THE STUDY

 To analyze the process of stock handling of medicines.


 To analyze the study of inventory control of medicines stock.

 To avoid stock outs or excess inventory.

 To maximize profit margin by proper inventory control.

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 5. RESEARCH METHODOLOGY

Medical Shop Management System is an application project developed for medical shops. This
system is a field concerned with purchasing and selling medicines, maintaining their
inventory, generating sales invoices and generating reminders of expiry date about medicines.
It requires more time and effort when all procedures are performed manually.
Thus, in order to reduce time consumption and human effort the Medical Shop Management
System application can be applied in medicals where manual procedure exists. The purpose of
this project is to reduce time consumption and human effort. This application provides user
friendly interface as well.

Every organization has a need to maintain their supply of material, man power, spares,
stock material etc. for work properly.
If there is any shortage of above mention things, they can cause havoc and stop the work of
organization.
Inventory control is important to ensure:
1. The drugs should be supply at right time in the drug store.
2. To avoid wastage and shortage and maintain optimal stock.
3. To reduce investment.
The inventory control plays a very important role in hospital store for planning,
acquisition, supply, & control of material.

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The various method of inventory control is:
1. A.B.C. analysis (always better control) - This analysis is based on annual sales values i.e.
The item is classified according to their percentage of annual sales values. The percentage
of higher sales values item prefer first in classification.
1. V.E.D. Analysis (Vital, Essential, Desirable)-This analysis is based on availability of
the item and its effects on the working of hospital.
1. E.O.Q. Analysis (Economic Order Quantity) - At the time of placing a purchase order each
company should not place the order in instalments. If the company places order after finishing
every stock it can cause bad effect on the inventory. To prevent
this E.O.Q. ANALYSIS is used for placing the order of materials for whole year
which minimize the total annual cost.
Total Annual Cost = Acquisition Cost + Ordering Cost + Carrying Cost

2. Lead Time- The time interval between placing an order and receiving order is called
LEAD TIME. The decrease in lead time is effective for inventory control.

3. Safety Stock- The stock remains during the period between placing order and new stock
received. It is the protection against running out of the inventory.

Having an adequate inventory on hand – but one should not get caught with obsolete items.

Successful inventory management involves simultaneously attempting to balance the cost

of inventory with the benefits of inventory.

Fig.3 stock percentage

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The medicines stock inventory can be controlled by following measures

5.1Safety Stock

Safety stock is the extra units of inventory carried as protection against possible stock-

outs. The safety stock must be carried when the pharmacy is not sure about either the

demand for the drug or the lead time or both. In the case where the demand is

uncertain, safety stock is the difference between the maximum usage and the average

usage multiplied by the lead time.

For example, assume that a pharmacy is faced with an

uncertain usage of Lisinopril. Lead time is constant at two days. Normal daily usage is 7

bottles but it can go as high as 10. The store would compute the safety stock as follows:

Maximum daily usage: 10 bottles

Average daily usage: 7 bottles

Excess 3 bottles

Lead time x 2 days

Safety Stock 6 bottles

Reorder Point

The reorder point is the inventory level at which it is appropriate to replenish

stock. The calculation is as follows:

Reorder Point = Average Usage Per Unit X Lead time + Safety Stock

First, multiply average daily (or weekly) usage by the lead time in days (or

weeks) yielding the lead time demand. Then add safety stock to this to provide for the

variation in lead time demands to determine the reorder point. If average usage and lead

time are both certain, no safety stock is necessary and should be dropped from the

formula.

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Example:

Demand = 1,000 vials per year

Store open 311 days/year

Daily demand = 1,000/311 = 3.2154 vials per day

Lead Time = 2 Days

R = dL = (3.2154)(2) = 6.43 rd, 7 vials per day

5.2 Drug procurement

Procurement of drugs is based on selected drugs and dosage forms and available financial resources.
Procedures adopted in procuring drugs include:

• Estimating quantity of each drug product required for a given period,

• Finding out the prices of the different drug dosage forms required,
• Allocating funds for each drug dosage form depending on:

• Priority nature of the drug and dosage form,

• Available finances.

Requisition for drug and dosage form is made after due consultation with prescribers.

Estimation of drug requirements

The estimate of the drug and dosage forms required for a given period is undertaken:

To avoid shortages (out of stock) and ensure credible health care service,
To prevent excess stock and avoid waste (loss or mismanagement of financial resources).

5.3Delivery (lead) time

It is important to establish how long it takes to have a drug delivered and receipted in the store so that
the drug does not become out of stock. This period is called the delivery or lead time. Delivery time may
be days, weeks or even months. Delivery time may be longer than two months because of the following
reasons:

• Poor road conditions, particularly in the rainy season,

• Poor condition of delivery vehicles,
• Increased work load at the issuing store,

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• Non-availability of adequate resources at the central store,
• Consumption rate of drugs.

5.4Monthly consumption

Monthly consumption may be collated with data obtained from:

• Bin (stock) cards,

• Daily use record, daily cash record,
• Drug register.

Normally, monthly consumption is obtained by:

• Calculating the average consumption over a period of time (e.g. six months)
• Or dividing the total consumption over the period by the number of months the drug dosage form
was consumed.

Example 1: Monthly consumption

The first method of calculating monthly consumption is to add the quantity of drugs in stock at the
beginning of a period (e.g., six months) to the quantity of drugs received during that same period and
then subtract the quantity of drugs remaining at the end of the period.

April 2000, quantity of paracetamol 1,000 × 500-mg tablet containers in stock = 14

June 2000, quantity of paracetamol 1,000 × 500-mg tablet containers received = 8
September 2000, quantity of paracetamol 1,000 × 500-mg tablet containers, remaining stock = 6
Therefore, total quantity of paracetamol 1,000 × 500-mg tablet containers consumed over a six-month
period = 14 + 8 - 6 = 16.

Average monthly consumption = 16/6

Average monthly consumption to the nearest container = 2 2/3

Example 2: Monthly consumption

A second method of calculating the average monthly consumption is to obtain data on

consumption from the bin card on a monthly basis and then find an average over a period of time.

April 2000 2 × 1,000 tablets

May 2000 4 × 1,000 tablets

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June 2000 2 × 1,000 tablets

July 2000 2 × 1,000 tablets

August 2000 3 × 1,000 tablets

September 2000 3 × 1,000 tablets

16 × 1,000 tablets

Average monthly consumption is

Average monthly consumption of container to the nearest container = 3

Example 3: Monthly consumption

A third method of calculating average monthly consumption is to obtain data on actual

consumption from the daily use record or daily use/cash record.

Data of monthly consumption of paracetamol 500-mg tablets over a six-month period.

April 2000 2,000 tablets

May 2000 3,100 tablets

June 2000 2,300 tablets

July 2000 2,100 tablets

August 2000 3,100 tablets

September 2000 3,200 tablets

Total six months 15,800 tablets

Average monthly consumption of tablet is 15,800/6 = 2633.3 tablets

Each container has 1,000 tablets. Therefore the average monthly consumption of 1,000-tablet tin =
2633.3/1000 = 2.6 tins

Average monthly consumption of paracetamol 500-mg tablets to the nearest container = 3

Completing stores requisition/delivery (issue) form

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It is advisable to make a request on a standard stores requisition/delivery (issue) form (see Diagram 3).
The stores requisition/delivery (issue) form should be produced in four copies. The original and two
other copies of the form will be sent to the central store when completed. The fourth copy is kept in
the dispensary to remind the health worker in charge of drugs or items requested.

Ensure that the following items are filled in correctly:

• Name of drug and dosage form;

• Unit of issue and quantity requested;

• The requisition number (it is preferable to begin with a new number each year, e.g. 1/00);

• The name of the dispensary and the date the requisition was made;

• The name and signature of the health worker making the requisition;

• Where the stores requisition/delivery (issue) form is designed to contain all the items listed, fill in only
the quantities of those items needed;

• Write down the approximate unit price of each requested item and the approximate total cost of
each item;

• Name and signature of the health worker making the requisition;

• The head of the health centre and a representative of the health committee should endorse the
stores requisition/delivery (issue) form.

Diagram 3
Model Drug Stores Requisition/Delivery (Issue) Form

Request no. ____________________________ Institution: ______________________

Name of health worker: ___________________ Date: __________________________

Delivery note: ___________________________ Total number of packages: _________

Packed by (name): _______________________ Date ___________________________

Checked by (name): ______________________ Date ___________________________

Handed over by (name): ___________________ Date ___________________________

Received by (name): ______________________ Date ___________________________

For official use only

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Item description Unit of Unit Quantity Total Quantity Total SignatureRemarks
issue price required price delivered price

1. Acetylsalicylic acid 1,000 tab

500 mg tab

2. Magnesium 100 tab

trisilicate

3. Chloroquine 100 1,000 tab

mg b

4. ORS sachets 50
sachets

5. Procaine penicillin 1 vial

vial

• Period for which supply is required, from _______________ to _______________

• The dispenser should comment on excess or short supply in the remarks column.

Name and signature of dispenser at health centre: ____________________________________

Name and signature of member of health committee: __________________________________

Name and signature of head of heath centre: _________________________________________

Diagram 17 Example of Inventory Form

Place: _____________ Date: ____________________

Item Quantity Unit PriceTotal Cost

Acetylsalicylic acid 500 mg tablet _____ 30 _____

Cotrimoxazole 400/800 mg tablet _____ 800 _____

Benzyl benzoate 25% lotion B/100 ml _____ 500 _____

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Chloroquine 150 mg tablet _____ 10 _____

Mebendazole 100 mg tablet _____ 10 _____

Folic acid 5 mg tablet _____ 5 _____

Total: _____ _____

Cash in hand:

Total capital:______________________________________________________________
Amount on CCSC: _________________________________________________________
Deficit/Surplus amount: _____________________________________________________
Name/Signature of health worker: _____________________________________________
Name/Signature of head of centre: ____________________________________________
Name/Signature of health committee representative: ______________________________
Name/Signature of person taking over Dispensary, where applicable): _________________

5.5 Role of supervision/inspection

Two teams should be involved in conducting inspection of the dispensary. The first is the team from the
appropriate authority. A pharmacist should be a member of this team. The second team is represented
by some members of the health committee.

Among other duties, the team should do the following:

• Ensure that drugs are properly arranged on shelves in the dispensary.

• Check that security measures are in place.

• Collect a few names with dates at random from receipt books, cross-check with the health centre
consultation register and verify if those patients were actually consulted before coming to the
dispensary.

• Recalculate at random the figures in the FRB to ensure that they are correct.

• In consultation with the health committee, make payments following laid down criteria.

• Decide with the health committee who will be responsible for deficits and surpluses.

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• Make advance payment of salary to the health committee who will later pay the health worker on
a monthly basis.

• Pay incentives where approved.

• Recommend to the health committee further work to be done in the dispensary.

• Give on-the-job training so that records are always kept up-to-date.

• Establish a report on-the-spot on observations and leave a copy in the health centre.

• Confirms the availability of all approved drugs on the list.

Once the product has been properly received it must be properly stored. Depending on the size and type
of pharmacy operation, the product may be placed in a bulk, central storage area or into the active
dispensing areas of the pharmacy. In any case, the expiration date of the product should be compared
with the products currently in stock. Products already in stock that have expired should be removed.
Those products that will expire in the near future should be highlighted and placed in the front of the
shelf/bin. The newly acquired products will generally have longer shelf lives and should be placed
behind packages that will expire before them. This technique is referred to as stock rotation. Stock
rotation is an important inventory management principle that encourages the use of products before
they expire and helps prevent the use of expired products.

Fig4. Medicine rack

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 Fig.5 Medicine rack

5.6Product Handling Considerations

Pharmacy technicians usually spend more time handling and preparing

medications than pharmacists. This presents pharmacy technicians with the critical responsibility
of assessing and evaluating each product from both a content and labeling standpoint. It also
provides the technician with an opportunity to confirm that the receiving process was performed
properly.

Since pharmacy technicians handle so many products each day, they are in a perfect position to
identify packaging and storage issues that could lead to errors. The three main issues to pay close
attention to are:

Look-alike Products. Stocking products of similar color, shape, and size could result in error
if someone fails to read the label. All staff members should be

alerted to look-alike products.

Misleading Labels. Sometimes the company name or logo is emphasized on the label instead of
the drug name, concentration, or strength.

Product Storage. Storing products that are similar in appearance adjacent to one another
can result in error if someone fails to read the label. It is essential to alert other staff
members to products that fall into one of these categories.

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5.7Drug Recalls

Pharmaceuticals will occasionally be recalled by a manufacturer and/or the Foodand Drug

Administration (FDA) for reasons such as mislabeling, contamination, lack ofpotency, or other
situations affecting the product as packaged or labeled. It is imperative that a pharmacy have a
system for a rapid removal of all products affected by recalls.Recall notices are sent in writing to
pharmacies by the manufacturer of the product or b drug wholesalers. These notices indicate the
reason for the recall, the name of the recalled product, and instructions on how to return the
product to the manufacturer.

Upon receipt of the recall notice a pharmacy staff member, usually a pharmacy technician,
will check the pharmacy and the institution to determine if recalled products

are in stock. If none of the recalled products are in stock, a note indicating “none in stock”
is written on the recall notice and filed in a recall log to document that the recall was
properly addressed. If a recalled product is in stock, all products should be gathered,
packaged, and returned to the manufacturer according to the instructions on the recall
notice. The package should be reviewed by the pharmacist in charge prior to sending it.

If patients have received a recalled product, the pharmacist in charge must take the
recommended action. Upon completion of all activity regarding the product recall, a summary of
actions taken should be written on the recall letter and filed in the pharmaceutical recall log.
Keep in mind that it may be necessary to order more stock to compensate for those items that

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were recalled. In some instances, the recall may encompass all products and it will not be
possible to order replacement stock.

Class 1 requires immediate recall because the product poses a serious or life-threatening risk to
health.
Class 2 specifies a recall within 48 hours because the defect could harm the patient but is not
life-threatening.
Class 3 requires action to be taken within five days because the defect is unlikely to
harm patients and is being carried out for reasons other than patient safety.

Fig6. Drug recall

5.8Controlled Substances

Controlled substances have specific ordering, receiving, storage, dispensing, inventory,

record keeping, return, waste, and disposal requirements established under the law.

There are two principles regarding controlled substances that the pharmacy technician should
know: ordering and receiving schedule II controlled substances requires special order forms and
additional time (1-3 days), and these substances are inventoried and tracked continuously. This type
of inventory method is referred to as a perpetual inventory process. Pharmacists and, in

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some institutions, pharmacy technicians work with pharmacist to manage inventory,
dispense, store, and control narcotics and other controlled substances.

5.9Expired Drugs

The most common reason drugs are returned to the manufacturer is because they are expired.
The process for returning drugs in the original manufacturer packaging is straight forward and
not particularly time consuming if done routinely. Returning expired products to the
manufacturer or wholesaler prevents the use of these products, while enabling the department to
receive either full or partial credit for them. To return products, pharmacy personnel must
complete the paperwork required by the manufacturer/wholesaler and package the products so
that it may be shipped. Technicians often perform these duties under the supervision of a
pharmacist. Some pharmacies contract with an outside vendor that completes the paperwork and
coordinates the return of these products for an agreed upon fee.

Pharmaceuticals compounded or repackaged by the pharmacy department cannot be returned and

must be disposed of after they have expired. It is important to dispose of these products for
safety reasons. Proper disposal prevents the use of sub-potent products or products where
sterility can no longer be guaranteed. The precise procedure for disposal is dependent upon the
type and content of the products.

Fig.7 expired drugs

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 6. RESULTS

A successfully implemented inventory control program takes into account such things as
purchasing goods commensurate with demand, seasonal variation, changing usage patterns,
and monitoring for pilferage. The challenge of productive inventory management is to support
an upward trend in sales while keeping the investment at the lowest level consistent with
adequate customer service.

There are several objectives of inventory control:

 Minimization of the inventory investment.

 Determination of the right level of customer service.
 Balance of supply and demand.
 Minimization of procurement costs and carrying costs.
 Maintenance of an up-to-date inventory control system.

Unfortunately, it may be impossible to achieve these objectives concurrently. For example, to

best satisfy the needs of patients, a pharmacy may have to carry a wide range of both prescription
items and front-end merchandise. In a hospital pharmacy,prescribers may want the pharmacy to
stock several therapeutically equivalent drugs.This cannot be achieved by minimizing inventory
investment. This is one of thecontradictory demands made upon the inventory control system.
Other include:

1. Increasing the inventory turnover – but one should not sacrifice service level.
2. Keeping stock low – but one should not sacrifice service or performance.
3. Obtaining lower prices by making volume purchases – but one should not end up with
slow moving inventory.

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 7. DISCUSSION

.. After exploring and analyzing the current routine in the pharmacy store, the main concerns
were related to managing inventory of medicines.The movement of pharmaceuticals into and out of
the pharmacy requires an organized, systematic, and cooperative approach. Pharmacy technicians are
familiar with the product conditions and uses puts them in a position to identify quality and care issues
that can strengthen the purchasing and inventory control system.
An effective purchasing and inventory control system requires all pharmacy staff to understand and
actively participate in the system, however, certain staff are responsible for managing the pharmacy
inventory and purchasing system. Even in a small pharmacy, considerable financial resources are invested
in the goods for sale. With drug prices being as high as they are, high costs are tied up in the inventory,
equipment, and fixtures of each pharmacy. As a worker whose job handling the pharmacy’s inventory,
they can help make the best use of this investment. In hospital pharmacies and larger community stores,
some technicians specialize in purchasing; they spend the majority of their time checking inventory
levels, placing orders, and following up on items not received. Relevant information was collected
from both primary and secondary sources.
It was found that reorder point and order quantity were determined based on arbitrary policy.
Findings of this thesis regarding inventory control showed that items in the pharmacy store
should be classified and prioritized. ABC and VED analyses has proved to be an efficient and
effective tool to classify medicinal products. The matrix retrieved from the combination of these
two classification methods can ease up the inventory management by narrowing down number of
items that need special attention and high level management. Different inventory methods such
as EOQ, fixed order interval approach and analysis were presented and explained. It requires
different inventory methods and types of management. Therefore, utilization of inventory
methods should be decided based on their suitability. The results are presented two primary steps
for implementing drug inventory control. The study can propose the possibilities to improve drug
inventory management in the pharmacy.
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 8. CONCLUSION

The movement of pharmaceuticals into and out of the pharmacy requires an organized,
systematic, and cooperative approach. The pharmacy technician plays a vital role in
maintaining the functionality of these systems. Pharmacy technicians’ familiarity with product
conditions and uses puts them in a position to identify quality and care issues that can
strengthen the purchasing and inventory control system.

An effective purchasing and inventory control system requires all pharmacy staff to
understand and actively participate in the system, however, certain staff are responsible for
managing the pharmacy inventory and purchasing system. As the primary handlers of
medication in the pharmacy medication preparation system, pharmacy technicians’
performance is critical to the success of the purchasing and inventory control system.

The job of any manger in the business sector is to create an environment in which the financial
and human resources of the firm are used to generate profit. Even in a small pharmacy,
considerable financial resources are invested in the goods for sale. With drug prices being as
high as they are, several hundred thousand dollars are tied up in the inventory, equipment,
and fixtures of each pharmacy.

As a worker whose job handling your pharmacy’s inventory, you can help make the best use
of this investment. In addition, in hospital pharmacies and larger community stores, some
technicians specialize in purchasing; they spend the majority of their time checking inventory
levels, placing orders, and following up on items not received.

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 9.BIBLIOGRAPHY

• https://www.denverpost.com/2010/05/21/the-benefits-and-limitations-of-
electronic-medical-records/

• https://www.google.co.in/search?q=abc+analysis+of+medicines&source=ln
ms&tbm=isch&sa=X&ved=0ahUKEwjh8PfVhYfaAhVGro8KHRo2C_wQ_AUICi
gB&biw=1366&bih=662#imgrc=d9UZ4xFDyYu3_M:

• https://www.google.co.in/search?q=expired+drugs&source=lnms&tbm=isc
h&sa=X&ved=0ahUKEwjbxrmInIfaAhWJLo8KHW9cCUwQ_AUICigB&biw=13
66&bih=613#imgrc=HNCQkJCpD_MSGM:

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