Evaluation of Pharmaceuticals Inventory Management in Selected Health Facilities of West Arsi Zone, Oromia, Ethiopia.

BACKGROUND:Effective inventory management ensures an uninterrupted supply of safe, effective, and affordable pharmaceuticals which could be achieved through developing ABC-VEN (Always, Better, Control-Vital, Essential, Desirable) and FSN-XYZ (Fast, Slow, Non-moving-High, Medium, Low Value) matrix analysis. ABC-VEN matrix analysis is used to control inventory according to their annual consumption and on their functional importance whereas, FSN-XYZ matrix analysis is applied to control inventory by identifying the items to be discarded and the amount saved during the closing of annual accounts. OBJECTIVE:To evaluate inventory management in selected health facilities of West Arsi zone, Oromia regional state for the year 2016-2018. METHODS:Facility-based cross-sectional descriptive study complemented with a qualitative study was conducted in fourteen health facilities. Data were collected from goods issuing vouchers for the year 2016-2018 to perform ABC-VEN matrix analysis. The frequency of issue was collected to perform FSN analysis and the value of each closing stock was taken to get XYZ analysis. RESULTS:From the ABC-VEN matrix analysis, 26.6% of items were Category I of which the highest proportion were taken by class A and V items consuming 84.7% of annual drug expenditure (ADE). The remaining 49.2% and 24.2% of the drugs accounted for only 13.2% and 2.1% of the ADE being category II and III, respectively. Based on FSN-XYZ matrix analysis findings, category I with 41.% item share account for the highest budget (average 86.5% of values). Of this category, the XN group-non-moving and high-cost drugs had the high value (20%) which need managerial measure. In category III, the ZN group items, being 25% of drugs, only had 2.2% of value-that may increase wastage, inventory holding cost, and shortage of storage space. CONCLUSION:The matrix analysis for inventory control is a strong tool that enables one to identify items requiring close monitoring. The coupled ABC-VEN matrix analysis, combining their individual advantages - inventory's cost and its functional importance help in achieving a meaningful inventory management. However, to control the stock at an appropriate level with minimum shortage and oversupply, it has to be supported by XYZ-FSN matrix analysis. The XYZ-FSN matrix benefits the health facilities to determine the level of inventory with high value in dead-stock, and to take measures like transferring to others, discarding, or saving.