Reducing Costs of Managing Medication Inventory in Automated Dispensing System in Hospital Units

Hospital pharmacies utilize automated dispensing systems (ADS) to store and dispense medication in hospital wards. We propose an algorithm to minimize the inventory management costs incurred in holding and refilling the medications stored in an ADS. The algorithm is a linear integer programming formulation to compute how to configure an ADS, and how to allocate medications into capacity-constrained containers. Using a numerical example with real hospital data we demonstrate significant percentage savings relative to the status quo.