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Advanced Inventory Management in Automated Dispensing Cabinets (ADCs) can Significantly Reduce Stockouts

September 22nd, 2021
Advanced Inventory Management in Automated Dispensing Cabinets (ADCs) can Significantly Reduce Stockouts

Automated dispensing cabinets (ADCs) are an indispensable component of medication distribution systems in pharmacies and hospitals across the country. ADCs offer countless advantages, including:

  • The improved control-substance inventory reconciliation process
  • Charge capture
  • First-dose turnaround time, and
  • Satisfaction of the staff of the pharmacy or hospital

Despite the many advantages, optimizing inventory management in ADCs can pose a significant challenge.

How are ADCs commonly stocked?

The standard inventory values in most ADCs installed in pharmacies and hospitals are calculated based on the average dispenses per day and the desired stock period (in days). In most establishments, the maximum (max) stock is adjusted to about six days a week, while the periodic replacement (PAR) is set at around three days.

If a medication falls below the PAR value, it is scheduled automatically to be replenished in the next stocking cycle. This system ideally should ensure that there are no stockouts as most ADCs are stocked daily. However, in certain cases, the average medication usage might exceed the observed trends of average utilization resulting in stockouts.

A stockout at an ADC can negatively affect patient care and disrupt the workflow of the pharmacy technicians and the nursing staff.

With the current system, avoiding stockouts can be a significant challenge as there is invariably a lag between the time of inventory drop below PAR value and the restocking process.

As the number of ADCs increases in an establishment, the efficiency can fall without increasing the technical labor, which can be expensive.

How can the challenges be addressed?

One of the ways to overcome these challenges is by implementing advanced inventory management in ADCs. The two most common inventory management systems that can be easily implemented include-

  • Dynamic inventory standards, and
  • Low inventory alert system
Low inventory alert system

A low inventory alert system is designed to immediately alert the pharmacy staff if the inventory in the ADCs falls below a certain percentage of the PAR value. The system is very efficient as it allows the technician to restock the ADCs before the inventory reaches zero and avoiding stockouts.

A study conducted in the University of Wisconsin Hospital and Clinics (UWHC) concluded that implementing both dynamic inventory standard and low inventory alert systems produced statistically significant reductions in stockouts across 62 ADCs included in the study. The study also concluded that implementing these inventory systems did not increase the inventory turns, suggesting that the decrease in stockouts was not merely a result of overstocking the ADCs, but by the system itself. 

Implementing advanced inventory management systems in ADCs can significantly reduce stockouts both in terms of number and duration. Correctly implementing such strategies ensures higher nursing, pharmacy staff, and patient satisfaction.

TouchPoint Medical provides state-of-the-art equipment including medDispense® automated dispensing cabinets with flexible configuration and AccessRx Series of medication delivery carts.

Our technicians are available round-the-clock to provide technical assistance, product information, and quotes. You can get in touch with us by clicking here.