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Managing expired stock and decommissioned products

Published
Topics: Procurement

Advice on how to manage expired stock and decommissioning of medicines.

This article forms part of a series
  1. Managing medicines inventory
    1. Understanding principles of medicines inventory management
    2. Completing regular and annual stock checks
    3. Reconciling stock in automated storage systems
    4. Monitoring slow moving stock and rarely used medicines
    5. Managing high value medicines
    6. Managing stock of critical medicines
    7. Managing high frequency order lines
    8. Managing expired stock and decommissioned products

Contents

  1. Using our advice
  2. Expired stock
    1. Areas for quality improvement
  4. Decommissioning products
    1. Actions

Using our advice

Refer to the first article in this series, Managing medicines inventory (SPS page), if you have not done so already.

The actions discussed are viewed as best practice, but none are mandated by SPS regional pharmacy procurement leads.

Expired stock

Robust processes must be in place if trusts are to manage medicines stock control successfully in all areas such as wards and departments as well as the pharmacy department. Patient safety relies on the right medicine being in the right place at the right time in the right quantity and in date. Adequate stock rotation in all areas should be a regular standard process.

Consideration should be given to rotating medicines held in critical locations where usage is minimal, this stock could be moved as the medicine nears expiry to a location where usage is high. An example are medicines stored in the emergency medicines cupboard; stock could be moved to areas where it is likely to be used such as Intensive Care Units, theatres or Accident and Emergency prior to expiry. The emergency medicines cupboard can be replenished with longer dated stock.

Areas for quality improvement

Trusts should review options to financially account for all expired stock using pharmacy IT system cost centres that do not contribute to the order algorithm. These are sometimes referred to as false cost centres. 

Financial losses through expired stock should be regularly reported and monitored.  For some Trusts, this might form part of internal and external audit requirements, and should be data accessible through standard reporting functions.  For Trusts that use expired stock cost centres on their pharmacy IT system, the RxInfo system can also support the ongoing reporting using the following link:

Decommissioning products

There will be occasions when a medicine held in stock in pharmacy will cease to be required, for example, when there is a change in clinical practice. An assessment giving consideration to regulatory requirements should be carried out to determine if the product

  • will be used prior to its expiry
  • can be sold to another organisation (Wholesaler Dealers Authorisation (WDA(H) may be required)
  • no alternative but to follow the appropriate trust waste destruction process.

The key activity is to ensure that the Trust can financially account for the cost of the product, whilst not replenishing stock that has no future demand.

Most pharmacy stock accounting systems will identify a positive financial transaction as activity that contributes to demand. Therefore issuing stock, the transaction is likely to also trigger a stock replenishment as it passes set system parameters, such as a minimum stock level. The subsequent automatic order quantity will be based partially on recent demand.

Trusts are encouraged to agree a local management plan to financially account for all stock and prevent inadvertent ordering where a product is expected to be decommissioned or have a reduced future demand.

Actions

The following are points to consider when liaising with clinical teams and adjusting some of those automated pharmacy ordering system triggers:

  1. Assess pharmacy stock holding, and all inventory held in clinical areas.
  2. Establish how long stock will last, including stock held within all clinical areas.
  3. Identify expired stock or stock that is nearing its expiry date.
  4. Agree whether stock will be wound down or all use will stop at an estimated end date.
  5. Consider centralising stock to provide better oversight.
  6. Review options for consolidating or transferring obsolete stock to residual usage areas. Trusts might want to consider options to sell stock if they hold a WDA(H).
  7. Agree a process for either consuming all remaining stocks left in the hospital, or how stock will be destroyed. For some medicines, such as desflurane, you might need to consult with your local or regional Net Zero Team.
  8. Consider removing the product from ward and clinic requisition and stock lists, including the use of any automated storage systems, or pharmacy system localities.

Pharmacy system considerations

  • Remove from all order scheduling routines
  • Review all fixed minimum order levels to prevent reordering stock, in some systems this might need to be removed instead of setting to zero
  • Review how you manage all expired stock as the process of internal transactions and requisitions can sometimes lead to an automated system generated order
  • Implement local practice for deactivating a product on your pharmacy system, for example, DUSE (SystemC), ZZ’ing a product description, removing from active selection
  • Review opportunities to decouple eCommerce system matches from the pharmacy computer system
  • Agree a process for charging all remaining stocks to prevent triggering an order