ZIFFPAGE TITLEA Cure for ComplexityBy John McCormick | Posted 2005-10-01 Email Print
Re-Thinking HR: What Every CIO Needs to Know About Tomorrow's Workforce
A customized inventory management system helps this online pharmacy to tie together its inventory, warehouse and shipping processes to keep things functioning with a minimal headcount and very low costs.
A Cure for Complexity
"There are so many variables, as far as the tracking and the lot numbers, expiration dates, NDC numbers," Drucker says, mentioning NDC, or National Drug Code, numbers, which serve as a universal product identifier. "It's not simply a gross of size 12 sneakers, number 800."
But the IDwhere system helps RxUSA figure it all out.
The system can handle any bar code—from the traditional Universal Product Codes to NDC codes. IDwhere reads the bar codes on the pharmaceutical manufacturers' cartons when they come in to determine what drugs are inside. It matches that information against NDC codes and stores the information in the RxUSA database under the appropriate drug code. IDwhere then produces a new bar code that contains the NDC code as well as information about where the boxes are to be placed in the warehouse. The new bar code is then slapped on the boxes, and the cartons are put on the appropriate shelves.
This makes the boxes easy to find. When an order comes in to RxUSA, Drucker or Scovotti will approve it and the system will process a work order, or pick ticket, that's generated on a printer in the warehouse. The pick ticket tells the guys in the back which drugs to collect, how much to get and where they're located in the warehouse.
The system also keeps a record of which customers are receiving shipments of a particular drug—a key for RxUSA. Tracking and tracing drugs is very important for drug sellers, which are required by the Food and Drug Administration to locate all of the drugs they've sold in case of a recall.
The system is so efficient that the warehouse is managed by just three staffers. "The goal was to take an inventory management solution and design it in a way that required the least amount of personnel with the most amount of automation," says Xiacon president Alan Sleszynski, who designed the system.
IDwhere also helps RxUSA keep an updated record of what's in its inventory—and how much that inventory is worth.
In the drug business, manufacturer and distributor prices are constantly changing. So Xiacon hooked up its system to a centralized drug pricing and product information repository maintained by First DataBank, a San Bruno, Calif.-based software and services company. Each week, the RxUSA system pulls drug pricing and product update information through a secure Internet connection Xiacon set up for RxUSA.
Xiacon experienced few hiccups during the RxUSA deployment, but the integration with First DataBank did present one challenge. The First DataBank repository contains about 100 tables with pricing and product updates. The files it receives are known as "flat ASCII fixed-width files," which means the records have no table headers or other identifiers. So, Xiacon designed its system to look in specific locations for the drug information it needs to populate its database. However, on one occasion, First DataBank modified some of its data formats without notifying RxUSA, according to Sleszynski. When the Xiacon program then pulled information from the same spots in the First DataBank database from which it had always retrieved information, it just grabbed the data that was there.
"We were pulling data that made no sense to us," Sleszynski says. It took Sleszynski a week to figure out the cause of the problem. He then had to go back and remap the RxUSA systems to conform to the changes First DataBank had made.
But overall, the system, according to both Sleszynski and Drucker, has been a huge success. And RxUSA continues to look for technologies to make the business even more efficient.
Drucker says the company has ordered a prescription-dispensing machine, from a company called ScriptPro. The machine, basically a pharmacy robot, has trays loaded with tablets and capsules that it releases into vials when an order is entered into the system. The machine then prints and applies the prescription label and slides the bottle over to a pharmacist, who checks the order before passing it on to shipping.
As Drucker explains: "The key is managing with a minimum of physical workforce and a maximum of productivity."
RxUSA 81 Seaview Blvd., Port Washington, NY 11050 Phone (516) 467-2500 URL www.rxusa.com Business Pharmacy Key Business Executive Robert Drucker, chief executive officer Revenue, 2004 $276 million Revenue Per Employee $15 million Challenge Maintain an efficient supply chain while ensuring that all bought and sold pharmaceuticals can be immediately tracked and traced Key Productivity Application Xiacon's IDwhere inventory management system
RxUSA 81 Seaview Blvd., Port Washington, NY 11050
Phone (516) 467-2500
Key Business Executive Robert Drucker, chief executive officer
Revenue, 2004 $276 million
Revenue Per Employee $15 million
Challenge Maintain an efficient supply chain while ensuring that all bought and sold pharmaceuticals can be immediately tracked and traced
Key Productivity Application Xiacon's IDwhere inventory management system