1. Jessica Tagerman, Pharmd, rph
Inventory Management
Jessica Tagerman, Pharmd, rph
Adapted from Pharmacy Technician Quick Study Guide & Mosby’s Review for the Pharmacy Technician Certification Exam

2. What is Inventory Management? Why is it important?

3. What is inventory management?
Products or merchandise (e.g. drugs, devices) available to meet future demand
2 Main Goals of Inventory Management:
Ensure medication is available to patients when they need it
Ensure costs associated with product procurement/time spent on inventory management are minimal.

4. Ordering Inventory
Ordering procedures are different for each pharmacy.
Factors that influence product ordering decisions:
Inventory turnover rate
Manufacturing sources
Purchase price

5. What are some strategies used to manage inventory?

6. Inventory Management Strategies
Just-in-time ordering:
Ordering a product just before it’s used.
PAR (Periodic automatic replacement) Value
Drug that is automatically reordered based on minimum and maximum inventory levels.
ABC Analysis:
A method used to identify and define inventory items based on their usage.
Focuses efforts based on the products that will have the greatest inventory turnover rate

7. Inventory Management Definitions
80/20 Rule:
80% of a pharmacy’s drug costs are derived from 20% of the pharmaceuticals carried.
Focuses on inventory control of the top 20% of the items carried.
Inventory turnover rate:
The cost of goods sold over the average inventory value
The larger the # of inventory turns indicates better utilization of financial resources of an institution

8. What are the types of different suppliers a pharmacy can use for the acquisition of medication?

9. Suppliers Wholesale drug distributors
Stock medications from all manufacturers
Manufacturers
Allows pharmacies to purchase in bulk, resulting in a savings for the company
Other pharmacies
Can transfer medications between pharmacies

10. Receiving Inventory
Upon delivery, a technician must verify accuracy of the received order with the original purchase order and the packing slip.
Drug name and manufacturer
Strength and dosage form of the medication
Appropriateness of packaging type
Quantity
Number of units received vs. number ordered
Damaged inventory
Should always document incorrect products or product shortages
Controlled substances require additional documentation

11. Storing Inventory
Technicians must learn which products require special storage conditions (i.e. refrigeration)
Stock rotation procedures are VERY important!
Items that expire soonest should be placed in the front.
Temperature Definitions °C °F
Room Temperature
Between 20° and 25°
Between 68° and 77°
Refrigeration
Between 2°and 8°
Between 36° and 46 °
Freezing
Between -25° and -10°
Between -13° and -14°

12. What are the different types of inventory counts?

13. Types of Inventory Counts
Initial
Accurate inventory of all controlled substances taken before a new pharmacy opens or when there is a change in PIC
Biennial:
Inventory required by DEA of all controlled substances every 2 years
CII- must be exact, CIII-CV, may be estimated
Perpetual:
Inventory that reflects exactly what is on hand at a particular time
Most commonly performed on CII medications
Physical:
An inventory conducted on a basis (typically yearly) to determine exactly what is on hand at a particular moment in time and the value of the inventory based on the current cost of that item

14. Medication Disposition
Recalls
Can be initiated by the manufacturer or the FDA
Class I- reasonable probability that use or exposure will cause serious consequences or death
Class II- use or exposure may cause temporary or reversible adverse consequences, with a remote possibility of serious consequences
Class III – use or exposure is not likely to cause adverse consequences
Expired medications
In many cases, pharmacies return expired, discontinued, recalled, or unusable products to the seller, and get a partial credit on return
Some medications cannot be returned- need to dispose of in accordance with federal and state laws and regulations.
Each pharmacy’s policy/procedures regarding expired medication is different

15. FDA Approved: How the FDA approval process works
Whiteboard discussion!!

16. Financial Accounting Terminology
Be sure to learn & familiarize yourself with the terms listed on pages of Mosby’s Review for the Pharmacy Technician Certification Exam!