Application of ABC-VED Matrix Analysis to Control the Inventory of a Central Pharmacy in a Public Hospital: A Case Study

The hospital's drug pharmacy is the most important facility in a hospital where large financial resources are allocated for the purchase of drugs that support therapy of patients. In order to direct these resources efficiently and effectively, it is essential to apply inventory models to manage the drug inventory in pharmacies. The main objective of this research is to conduct a systematic classification for the drugs in a central pharmacy inventory of a public hospital. The necessary data about the 138 drugs dispensed were gathered for the period between 1/1/2018 ? 31/12/2018. The ABC (Always, Better, Control), VED (Valuable, Essential, Desirable), and ABC-VED Matrix analysis were used to group the different types of drugs into three categories, I, II, and III. Data analysis was conducted by Microsoft Office Excel 2013 and by statistical methods. The VED analysis revealed that (81% of the Annual Drug Expenditure, (ADE) were allocated to Essential drugs, while categorizing the drugs indicated that (71.47 % of ADE) should be allocated to category I which includes AV,AE, AD, BV, and CV drug groups. This research concluded that top management should exert high supervision and control to drugs that fall in category I, then category II, and last category III. This research work is significant because it augments our knowledge about inventory control in general, and pharmacy inventory control systems in specific.