A PROFILE OF DIRECT PURCHASING
Lauren Flick, Abbi Rowe
Background: For many health systems, almost the entirety of the drug inventory is purchased “indirectly” through a wholesale partner. This traditional model allows for streamlined access to a variety of products, provides an easy-to-use and regulatorily compliant ordering process, offers quick and consistent logistics, and is able to facilitate smaller, single unit of sale purchases. However, for health systems with the appropriate infrastructure, establishing direct purchasing relationships can be beneficial. AdventHealth’s Central Florida Division includes a Central Fill Pharmacy (CFP) that supplies drugs daily via an internal courier service to 18 acute care facilities within the division. CFP is located at an offsite warehouse space with roughly 15,000 square feet of medication storage space, allowing for pallet storage of bulk medication purchases. This system provides advantages based on the volume of medications purchased, as well as storage solutions for larger orders, which can be leveraged when optimizing cost savings though alternate purchasing streams.
Purpose: Evaluate historic direct medication purchasing trends for process optimization opportunities.
Methods: Direct purchasing data from the CFP facility was compiled using historic invoices and logged in an Excel spreadsheet. All direct commercial medication purchases made from 3 September 2021 to December 2024 by CFP were included. Supplies and 503B purchases were excluded. The invoice date, medication description, NDC, quantity purchased, average blended price available at the wholesaler at the time of purchase, and direct price
[LF1] were all recorded. Descriptive analysis of the data, including counts of unique molecules and NDCs, averages of cost savings and quantities purchased, and various pivots of the historic data was performed using Excel. Data visualization charts were created to display the findings and begin development of a comprehensive dashboard for ongoing tracking and optimization of direct pharmacy purchasing.
Results: A total of 757 historic transactions were included in the analysis, with the highest number (n = 353) occurring in 2023. While the median amount spent per order fluctuated between years ($8,462 in 2021, $9,600 in 2022, $7,150 in 2023, and $7,725 in 2024) the median savings per order decreased each year; from $5,600 in 2021 to $1,944 in 2024. This suggests a willingness to complete purchases with smaller cost reductions associated with them, which could be related to familiarity and comfort with the
process reducing the time investment required. The largest percent of savings from a single drug came from dexmedetomidine, which accounted for 12.43% of total savings. Heparin, which had the highest number of total units purchased at 413,000 units, accounted for 5.88% of savings, and enoxaparin, which had the most purchases (158) and NDCs (21) accounted for 5.25%. The drug class with the highest portion of savings was antimicrobials, with 35.32% of overall spendings, followed by cardiovascular drugs, which had the highest number of buys (261), NDCs (55), and individual units (973,006) and accounted for 28.49% of savings. For analysis of purchasing source, Medigi was the highest in number of buys (399), maximum saving percent (86.5%), NDCs (133), and total units purchased (1,631,072), and accounted for 60.70% of total savings.
Conclusions: Direct purchasing
is capable of sufficient procurement cost reduction for AdventHealth Central Fill Pharmacy to continue with the process. While a few purchases of high-discount drugs can have result in large per-transaction savings, most of the accumulated savings over time comes from lower rates of savings on commonly purchased drugs. Optimizing this process has the potential to allow for greater cost reduction in the future.
