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Learning Objectives

  1. Compare and contrast wholesale versus direct drug purchasing processes and strategies.

  2. Describe the implementation and requirements for the Drug Supply Chain Security Act (DSCSA).

  3. Explain pharmacy storage requirements and organization recommendations.

  4. List inventory management and legal recordkeeping requirements.

Setting the Scene

You have been a practicing pharmacist for the last 5 years. Your current role is a staff pharmacist at a regional grocery store chain pharmacy. The pharmacy you serve is one of the top performing stores in the company with weekly sales averaging over $250 000 and a prescription volume of 5000 scripts per week. The pharmacy’s existing inventory totals over $1 million. The current Pharmacist-in-Charge or Pharmacy Manager is relocating across the state and you have been offered the position. You don’t have any pharmacy management experience, but your past performance and hard work makes your Regional Director of Pharmacy confident that you are the right person for the job. After accepting the job, you take over as Pharmacist-in-Charge in 1 week. You have also been informed by your Regional Director that your pharmacy is due to take inventory in 1 month. Feeling clueless about pharmacy inventory and its management, you spend some time talking with the current Pharmacist-in-Charge.


In a strict definition, pharmacy inventory is the product that is available and in saleable or usable condition within your pharmacy. Pharmacy inventory may include nonsalable items such as out-of-date products or recalled items not yet processed. This includes pharmaceutical ingredients used in compounding.

Beyond this strict definition, pharmacy inventory can be expanded to include the purchasing options, requirements, regulations, and recordkeeping associated with the products mentioned above. In this chapter, we will explore all the components of pharmacy inventory.


Drug purchasing is one of the most important, yet a complex issue in managing a pharmacy. Inventory is generally a pharmacy’s largest asset and drug purchasing is the key to driving cash flow and profitability to the bottom line. With the wide variety of purchasing options, terms, and ordering methods available today, finding the right mix for the individual pharmacy is imperative to proper inventory control and profitability.

If you were opening or managing a pharmacy today, there would be several choices you would have to make regarding how to procure your inventory. These decisions must be made to provide the most efficient and profitable method of sourcing your inventory.

Purchasing Options

First, where do you buy your inventory?

You have several options available to you, but the most common is to buy through a purchase agreement with a drug wholesaler such as AmerisourceBergen®, Cardinal®, or McKesson® to name a few. A primary wholesale account can be set up with a ...

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