Pharmacy Inventory Management System: Main Features & Benefits

Pharmacy Inventory Management System: Main Features & Benefits

August 9, 2023
Home Health & Wellbeing Pharmacy Inventory Management System: Main Features & Benefits
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All pharmacies have a dynamic and vast supply-chain network they should manage, irrespective of whether it is part of a medical facility or an independent shop. The supply costs of any pharmacy are vulnerable to several factors which contribute to increasing costs and affect profitability. 

The stock inventory projection should also be assessed accurately. Although pharmaceutical products tend to have a mid-term shelf life, overstocking still usually leads to a loss of value. Pharmacies should address important aspects like proper storage, expiration dates, and more.

This makes pharmacy inventory management a must-have for most drug stores today.

Numbers to explore before we move

1.4 Trillion
The global pharma selector produces $1.4 trillion in U.S. economic output
6.47 Billion
About 6.47 billion medical prescriptions were dispensed in the U.S. in 2021
+9% from 2023 to 2030
Pharmacy Inventory Management Market is expected to grow at a CAGR of +9% from 2023 to 2030

The Architecture of an Inventory Management System in Pharmacy

Pharmacy is made up of several modules: inventory, deliveries, prescriptions, billing, loads of documents, employee, user management, etc. Managing these processes can be organized in the following architecture:

Inventory Management

In contrast to paper-based inventory (which is difficult to manage and is linked with human mistakes), inventory management pharmacy units allow pharmacies to look up stock levels, define the location of required items, and keep data updated as soon as someone buys from the pharmacy. Inventory management software also allows for data-driven decisions based on history: what drugs will be in demand for refills, time of the season, weather, and other factors.

Document and Data Management

Pharmacies deal with a vast range of documents (prescriptions, data, orders), so small notes are often lost, and documents require lots of space for storage. Pharmacy inventory software allows you to store the documents neatly in virtual folders so staff can find data just by entering keywords.

Pharmacy Inventory Management System

User Management

User management grants access to authorized users only. Pharmacies can establish role-specific access, meaning some staff will only get data about inventory while management will be able to explore the entire picture with analytics, sales reports, as well as the performance of specific employees.

Prescription Management

The prescription management module helps pharmacists to reduce the risk of stolen or faked prescriptions, receive e-prescriptions and process them faster, and get notifications regarding contradicting medications or allergies. This module allows for higher efficiency, lifts off the pressure of producing and selling controlled substances, and improves patient care.

Pharmacy Analytics

Analytics remains the most crucial pharmacy software module. It helps pharmacies to achieve business goals faster by offering a clear overview of the drug store’s performance over an estimated period. The performance analysis includes the following:

  • Revenue;
  • Biggest expenses and losses;
  • Reasons for shortages;
  • Customer behavior. 

Reports allow pharmacies to manage their inventories better, optimize losses from lack of insurance reimbursements and adopt new practices safely.

eCommerce

Pharmacies, pretty much like hospitals, are considered to be among the places where the chance of getting a virus is always high (and now we are not talking solely of COVID, people have become afraid of offline shopping or clinic visits).

It makes sense to add an eCommerce module while developing pharmacy management software so the pharmacy is able to run its own website without creating it from scratch. 

Multi-Store and Multi-Location Support

Large pharmacy chains are one of those who need pharmacy management systems the most – they need to manage several stores in different locations. The ability to see a bigger picture while still being able to take a look at individual points in detail becomes a must-have with multiple locations. Therefore, it is best to have analytics on each chain level and inventory management for further distribution.

Integrations

healthcare data integration module means a pharmacy will be able to integrate with e-prescriptions, point of sales, and EHR/EMR systems. This module eliminates the need for manual data entry, which will only increase the employees’ workload and a number of mistakes.

Pharmacy Software Systems: Key Features

Pharmacy Management System

E-Prescription


  • Eliminate prescription errors by offering a user-friendly option for healthcare providers and patients.

  • Reduce confusing paperwork and facilitates rapid dispensing of the right medication.

  • Allows pharmacists to manage drugs, improve productivity, ensure quality care and patient’s satisfaction.

Automated SMS Messages and Notifications


  • Schedule reminders and send notifications to patients before their prescription runs out.

  • Get feedback from patients.

  • Drive personalized engagement between patients and pharmacies.

Expiry Control


  • Prevent huge losses from expired drugs and medical products.

  • Pharma stores can keep track of expiry dates.

  • Sell medications based on a first-in, first-out strategy.

Stock Reorder Management


  • Strike a balance between reordering and supply levels.

  • See a clear picture of how medications sell (those in high/low demand and will be out of stock soon).

  • Receive data to set a minimum stock level.

  • Create time to easily place an order for new supplies.

Centralized Database and Backup


  • Eases the process of retrieval.

  • Schedule automated data backups to avoid data loss in case of unauthorized access.

Data Reporting and Analytics


  • Review data-driven reports regarding the standard prerequisite of drugs and their performance.

  • Manage medication inventory with various metrics, including ROI and sales.

  • Calculate reorder points according to the product and category.

  • Customize reports to check marketing insights, budgeting roadmaps, and patterns.

Multi-Store and Multi-Location Synchronization


  • Manage data and stocks across all points of sale.

  • See comprehensive reports in a central database.

Integration with Third-Party Software


  • Integration with EHR/EMR systems, prescription monitoring programs, interactive voice response, point of sale software, DHL, and medical insurance verification software.

Compliance and Regulatory Feature


  • Stay compliant with primary regulations (HIPAA, GDPR, DEA, and more).

  • Implement current security measures.

  • Ensure the smooth handling of business activities.

Customer Support System


  • Improve customer satisfaction.

  • Record patient data for effective data management.

  • Automatically update patients’ lists to control patient treatment.

Pharmacy Inventory Management System: Operational and Financial Benefits

  • #1: Increased Speed
  • #2: Increased Accuracy
  • #3: Improved Time Management
Increased Speed

#1: Increased Speed

One in five U.S. residents will be of retirement age by 2030. Given that 87% of people between the ages of 65 to 79 use prescription drugs, pharmacies can expect a drastic increase in prescriptions to fill. Manual efforts will not effectively cover all needs and keep up with the demand. Pharmacy inventory management software will greatly increase each pharmacy’s productivity.

Increased Accuracy

#2: Increased Accuracy

People make mistakes, regardless of how many checks, balances, and safeguards pharmacies implement. While making mistakes is expected, in the pharmaceutical industry (overall medical field), even the smallest error can lead to a financial and operational disaster.

On-hand stock accuracy provided by pharmacy management software assists in avoiding overstocking and stock-outs. Some solutions also help re-calculate optimal order points every month for each item or group according to the changes in dispensing.

Improved Time Management

#3: Improved Time Management

Manual data input and paper trails are not needed in today’s state. Inventory management software for pharmacies streamlines inventory tasks, freeing up technicians and pharmacists so they can focus more on patients and the care they provide.

Alongside the increase in patient load, new regulatory requirements and compliances are put into place often, and the requirements for medications increase. This forces pharmacies to transition from manual to error-free tools and processes. Inventory management is a clear step in this direction.

Pharmacy Inventory Management | Types

There are 3 types of pharmacy inventory management:

Visual Method

The visual method requires medical staff to manually inspect the inventory. If the inventory of any drug appears insufficient to cover an upcoming demand, the pharmacy triggers a replenishment. In most cases, both pharmacists and technicians are usually too busy to place an order on-time and will often write themselves a note or commit the needed reorder to memory.

As a result, stock issues are not realized until it is too late. This method is not effective. It is an almost impossible task to keep up with constantly changing inventory stock and patient demand.

Periodic Method

Similar to the first option, the periodic method focuses more on performing basic inventory management tasks at specific routine intervals. Pharmacies may incorporate basic technology that can remove the need for manually updating each status as well as incorporating barcode scanning. Therefore, pharmacy staff inspects the inventory at specific periods: either once a week, month, or year.

Although more systematic compared to the visual method, the staff members may notice inaccuracies after status updates, so the method still relies on pharmacy personnel to make decisions based on their observations, experience, and analytical knowledge.

Pharmacy inventory management system 2024

Perpetual Method

The perpetual method is used to measure inventory in real-time using a computer system. This system continuously and automatically updates on-hand quantities based on delivery and dispensing.

It utilizes an automatic replenishment system that guarantees medications are identified for reorder when the stock level either falls below or reaches a calculated replenishment point. Items identified by the system are then reviewed and accepted by the staff, removing the need for a visual inventory. The system electronically orders the items via EDI through the pharmacy management system.

Off-the-Shelf vs. Custom Pharmacy Management System

Ready-Made

You may have already encountered many off-the-shelf inventory management solutions. Most of them promise to instantly streamline any inventory management process with an easy set-up. Although these solutions are great for medical set-ups, they also have several downsides to learn before choosing which option to use.

Custom

Custom software development by a telemedicine app development company offers a highly personalized approach to technology implementation designed to cover customers’ unique needs. Every part of the solution, including security measures, the chosen technology, features, and user interfaces, are designed and developed in regard to the target user base, budget, particular business requirements, and existing processes.

pharmacy inventory management system image
Pharmacy Inventory Management System by Interexy

Electronic pharmacy inventory systems will continue to enhance the overall quality of care provided and help pharmacies optimize their operations. These systems also form a large part of the broader integrated care management strategy in large medical set-ups.

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FAQs

  1. What is a pharmacy inventory management system?

    A hospital pharmacy inventory management system is a system implemented to provide better stock control, replenishment, and medication dispensing.

  2. How much does it cost to develop a pharmacy inventory management system?

    The answer depends on several factors, such as timelines, the app complexity, the development model you choose, and more. The cost usually starts at $50,000.

  3. What are the most common features in a pharmacy inventory system?

    Among the most common features in the inventory system for pharmacies are electronic prescriptions, automated SMS messages and notifications, stock reorder management, a centralized database, and back-ups.