Pharmacies play a major role in keeping all of us healthy. If it weren’t for the neighbourhood pharmacy, we would have to depend on ourselves to find and prepare our own medicines just like people did more than 200 years ago. Managing a pharmacy of a single store or a chain is challenging with many regulations, competing requirements, cash flow management, patient & document management, and increasing reliance on online Pharmacy Management Software.
To server patients’ needs, a pharmacist must check the prescriptions by doctors and interpret them, assess the correct dosage of the drugs, dispense drugs, and then regularly check patients’ drug regimens. To help with patients’ insurance requirements and the company’s financial obligations, a pharmacist has to check & complete insurance forms, furnish bills to insurance companies. They also must keep impeccable records of drug & material inventory, cash memo & invoices, and ensure that all drugs – sold, in-store, returned, and expired – are accounted for accurately.
Other key responsibilities of a pharmacy manager include managing staff, handling sales & returns, taking feedback & complaints from customers, planning for doorstep delivery of orders, and carry out marketing. To manage such a complex system manually with the help of registers and loose paper documents can be a nightmare, inefficient, and error-prone due to manual bookkeeping practices and human error. The COVID-19 restrictions placed on the presence of all employees even at pharmacies and most of the people wanting doorstep delivery of their prescriptions have brought to the force the need for implementing a pharmacy management system for your pharmacy store or chain of pharmacies in the same or multiple cities.
Implementing a Pharmacy Management System (PMS) will also help you to add a new store to your chain, open a new pharmacy store chain, or revamp the present ones. With most of the work automated, documents digitized, and records easily & efficiently accessible, you will see that your burden is relieved & boost efficiency. An efficient and well-designed PMS can help you streamline workflow within your store or chain, without compromising on the quality of service or skipping any of the important checks & details. With enhanced efficiencies and costs savings, even with the same store, you can see a spike in revenue and overall profitability.
With the stocks of the medicines and other articles automatically ordered from the distributor or manufacturers, you will never lose sales due to shortages. Prescriptions of patients will never get misplaced, doctors could send their prescriptions directly to you, and you could pull detailed reports whenever needed.
Pharmacy Management Software Market Overview
Table of Content
- 1 Pharmacy Management Software Market Overview
- 2 Challenges Faced by Pharmacies:
- 3 What is a Pharmacy Management System (PMS)?
- 4 Do I need a PMS for my store?
- 5 Who should implement the Pharmacy Management System?
- 6 When is the right time to Deploy a Pharmacy Management System?
- 7 Benefits of a PMS
- 8 Pharmacy Management System Modules
- 184.108.40.206 Inventory Management
- 220.127.116.11 Workflow Automation
- 18.104.22.168 Prescription Management
- 22.214.171.124 Document and Records Management
- 126.96.36.199 Orders, Returns, and Refunds
- 188.8.131.52 POS Integration
- 184.108.40.206 Analytics and Reporting
- 220.127.116.11 Revenue Cycle Management
- 18.104.22.168 Online Pharmacy
- 22.214.171.124 Notifications and Alerts
- 126.96.36.199 Customer care alerts
- 9 Build v/s Buy
- 10 Steps to Design a Pharmacy Management System
- 11 Technology Stack for Pharmacy Management Software
- 12 Cost to develop Pharmacy Management Software?
- 13 Wrapping up
- 14 Let the Ideas Roll!
- According to a published report by IMS Institute for Healthcare Informatics, 80% of the time patients need medications under all treatment plans. The same report projected, that the number of prescriptions dispensed in the USA will cross the 5 billion mark in 2021. This will be an increase of close to 1 billion prescriptions over the past decade.
- The Patient-centred Medication Resource Guide from PCPCC cites the World Health Organization, that close to 50% of patients suffering from chronic diseases adhere to complete course or therapy for developed countries. This alarmingly low poor adherence to medical regimens has resulted in avoidable adverse health events and a substantial increase in an individual’s health care costs.
- As per latest report released by Reportlinker.com on the Global Pharmaceuticals Industry Trends, the global legal pharmaceutical sales market was valued at USD 1.25 trillion in 2019 and is projected to grow to USD 1.57 trillion by 2023.
- The same report says that North America, comprising of the USA, Canada and Mexico had more than 40% market share of this market and may continue to have around 45% market share in 2023 too. This translates into USD 680 to 710 billion opportunities for pharmacy stores and chains to tap into.
- Another way to look at the same data point is from the manufacturer’s perspective. A report by Grand View Research states that the pharmaceutical manufacturing market size was valued at close to USD 325 billion in 2019 and is expected to clock a CAGR of 13.74% between 2020 and 2027. It also stated that in 2019, like earlier, prescription medicines were the most dominant category of the market with maximum revenue share at more than 85%. This is going to remain the same going forward.
- The Grand View Research report cites a report by the American Journal of Health-System Pharmacy and data from Vizient’s Pharmacy Program, that the overall prescription drug spending in the USA rise by 4-6% annually.
- The COVID-19 pandemic has accelerated the need for contactless delivery of medicines, prescriptions, and documents. The restriction on movement has forced companies to find innovative ways to cope or fail miserably.
- Most importantly, it has woken up the world to the perils of ignoring the doctor’s orders. A survey by the American College of Clinical Pharmacy stated the number of people filling up their prescriptions on time has seen a significant jump. It expects the number of prescriptions dispensed online to cross the 5 billion mark in 2021.
Challenges Faced by Pharmacies:
Like any other business, pharmacies also face many challenges. These roadblocks and challenges have transformed or grown bigger with the passing of time. Most of these challenges are surmountable with proper guidance and help from the right people at the right time. The common challenges, which slow down the business growth, faced by pharmacy store and chains include:
Lack of Uniformity
Most pharmacy chains either grow organically or inorganically. In any case, each store, to build its own identity, makes its own rules, workflow, and processes. Also, when two stores or chains merge, to form a larger chain, they may have completely different work-culture, workflow, and processes. Because of these inconsistent procedures, many errors, confusion, and anomalies may creep into the system. From time to time, people using the system may get confused about what course of action to follow in case of something new or unexpected.
Many doctors still scribble prescriptions on their letterhead, and even patients feel a sense of agency with such a document in their hands. But we are aware of the illegible handwriting of far too many doctors, it can cause system delays or errors. If a pharmacist is unable to understand what the doctor has written, then she may contact the doctor’s office to get details, while the patient must wait for no fault of theirs. Or, if the pharmacist is unable to contact the doctor, then she may fill the prescription anyway and increasing the chances of the error.
Paper-based prescriptions also make it difficult to refer to them after a long time and are prone to destruction by natural elements or human mistakes.
Manual billing can be the source for many errors – incorrect tax computations, incomplete entries, illegible names of the medicines, doctor or the patient, inefficient workflow, outdated inventory information, and even calculation mistakes that affect the bottom-line.
Inventory management is not just about taking the stock of current medicines and supplies in the pharmacy. It also involves the decision-making process about which item to order when, in how much quantity, and from which supplier. Inventory requires assessing the value of the supplied in stock or transit, for insurance purposes. Medicines require special attention as they can be expired if not sold timely to patients. That could lead to either unsold stock with loss of sales, or unsold stock due to greater purchase orders than needed.
Both cases result in avoidable losses and your working capital may get stuck in an item that does not sell fast instead of that does. The discrepancy in finding medicine demand as per the past trends can cause overstocking or understocking.
Payments from clients and to suppliers & staff affect the cashflow of all businesses. In case of pharmacies, cash management and payments management are the more acute problem as monthly sales are mostly fixed but not the expenses. A lack of streamlined payment management systems with a proper online billing solution can create inefficiencies in cashflow.
Regulators routinely change how some medicines are to be dispensed. For example, they may start demanding saving of the prescription for certain medicines and may exempt some other. Pandemic has also created certain shortages in pharmacies that required the regulators to step in for controlling the stock limits, sales limits, pricing, and prescriptions standards for many medicines and essential supplies.
Lack of Automation
All the above problems may have a single reason if we assume that the people are efficient, but the manual system is the bottleneck – lack of automation. With an automated system to take care of prescriptions, records management, patient management, billing, inventory, etc., pharmaceutical stores and chains can devote more time to serving the needs of the patients rather than handling paper. Current pharmacy systems lack automation techniques and work with processes that are physically executed.
What is a Pharmacy Management System (PMS)?
A Pharmacy management system or PMS is a system to automate many processes, records, workflows, and billing needs of a pharmacy store or a chain of such stores. The actual work of finding the needs of a patient and dispensing the medicine to them is still done by qualified pharmacists, but menial jobs like label printing, stock register maintenance, etc. are taken over by an online system. This online PMS can store data and can be easily extended to add more sections or stores to a pharmacy chain. The system can allow the network doctors to send in their prescriptions directly to the store and alerting the patients to pick their medicines once they are ready.
An online Pharmacy Management System can allow easy integration of a pharmacy chain with an online store to let customers upload their prescriptions and get doorstep delivery of their orders. Electronically sending orders to suppliers, billing details to insurance companies, and alerts to doctors & patients, all can be done by the PMS efficiently.
A fully integrated pharmacy management software will let you automate processes like inventory control, drug labelling & dispensing, record management, insurance claim management, cash & credit billing, payments management, staffing & payroll, taxes & utilities, and reporting on all aspects of the pharmacy store.
These systems are meant to be secure to meet regulatory requirements and the highest security standards of insurance and credit card companies. So, you can rest assured that your business data and your patient’s medical data will be always safe.
Do I need a PMS for my store?
At Arka Softwares, we design Pharmacy management Systems with your needs in mind and not our technical ability. Our PMS has modules to automate drug dispensing workflows, create patients’ master index, manage lists of approved medications & supplies, handle inventory, and process orders & claims. Our PMS is fully compliant with all the regulatory needs with all reports demanded by regulators to help you in compliance management. Our analytics engine can give you insights into the trends of sales, patients’ behaviour, and access to leading formulary databases like Lexicomp, RxNorm, First DataBank, Medi-Span, and the National Drug Code.
Who should implement the Pharmacy Management System?
- The PMS designed by Arka Softwares is suitable for both individual pharmacy stores and for a chain of pharmacy stores. Your chain could be a local chain within municipality limits, or it can be a multi-city, or even a multi-state chain, with different rules applicable to each store.
- The workflow at each store, whether individual or part of a chain is quite similar as they are governed by the same set of regulations. The difference comes in analyzing the data at the individual or group level. Our PMS has extensive reporting and analytic capabilities for each business.
- Moreover, the PMS would allow you to easily add stores to your chain, merge stores if you acquired one, or start a chain of stores from an individual store. The process of store creation is straightforward and economical compared to buying a new software license for each new store.
- In addition to retail stores, large businesses dealing in drugs in large quantities such as B2B businesses involved in pharmaceutical distribution, warehousing, and manufacturing can also immensely benefit from our Pharmacy Management System.
When is the right time to Deploy a Pharmacy Management System?
The right time to start something new and use something efficiently is always NOW. If you are already fed-up with the inefficient, error-prone, and leaky system; if your customers get irritated because of the long queues and frequent complaints of medicine shortages; if your records, data, billing, and inventory management have gone out the window, then now is the right time for you.
As a pharmacist, you are very aware of the fact that timely medication and treatment can be a game-changer. Similarly, the all-in-one medicine for your all business ailments is a feature-rich PMS that caters to your needs and is user-friendly.
An efficient pharmacy management software can solve challenges such as:
- Pricing, billing, and payments.
- Medicine classification and choice.
- Stock ordering system.
- Pharmacy labelling and dispensing.
- POS integration.
- Insurance claim, credit, and cash balancing.
- Online pharmacy store management.
- Prescriptions, patient records, and document management.
Benefits of a PMS
A properly customized Pharmacy Management System that serves all needs of a pharmacy store can help in achieving multiple goals at the same time. You can deliver the highest level of personalized care, maximize profits, save costs and be compliant with all regulations.
Among many benefits of a Pharmacy Management System, some of them are as follows.
Every aspect of a pharmaceutical business – manufacture, distribution, and sales – are governed by strict guidelines such as HIPPA, FDA, DEA, etc. the PMS from Arka Softwares is easily customizable to meet the strict legal requirements from all major regulators and government agencies controlling the trade of drugs and medicines.
Our PMS also meets the standards set by many accreditation standards and regulators including:
- NCPDP – National Council for Prescription Drug Program
- USP – United States Pharmacopeia
- HHS – The U.S. Department of Health and Human Services
- EMA – European Medicines Agency, European Union
- MHRA – Medicines and Healthcare products Regulatory Agency, UK
- HITECH -MU – HITECH’s Meaningful Use specifications
- HIPPA – Health Insurance Portability and Accountability Act
- HL7 -Health Level 7 International
- FDA21 – The Food and Drug Administration’s Title 21 CFR Part 11 rules.
These regulatory bodies require a pharmacy to send multiple reports in different formats and need direct access to your records. The PMS design can produce the desired reports and records and let a limited set of authorized users access the system for external audits.
In addition to selling prescription medicines, a pharmacy store can sell many other related supplies and over-the-counter (OTC) medicines. A customer will come to visit your store if they can get all their requirements in one place.
A loyalty system can offer customers of your non-prescription articles an extra advantage in coming to your store, giving a boost to your sales. You can open the loyalty program for all customers and let all customers win redeemable loyalty points on their all purchases.
Adapt New Business Model
You may be a walk-in pharmacy store, or you may be a fulfillment center for an online pharmacy. You may be dealing with end-customers directly or you may be dealing with other stores as a B2B business. Whatever your business model, you can get to start an added line of related business if you have our PMS for pharmacy management. Our strong foothold in the end-to-end value chain of pharmacy storage, distribution, and sales can benefit you enter any of the segments you are not present in now.
- Economical and affordable solution.
- Increasing productivity of staff.
- Lesser errors mean lesser time spent on finding & fixing them.
- Flexible system customization to suit your requirements.
- A large number of modules for all processes & workflows.
- Separate user logins with differentiated rights and duties.
- Integrated barcode scanner for faster prescription reading and billing.
- Integrated POS module for faster checkout.
- Integrated delivery tracking, shipping, and order processing modules.
- Expiry date and minimum stock alerts.
- Detailed and summarized analysis report based on multiple parameters.
- Centralized & secure data storage system for easy retrieval by authorized users.
- User-friendly with intuitive UI design.
Pharmacy Management System Modules
A well-designed pharmacy management system must have some essential modules and may offer on-demand access to some optional modules. Based on our vast experience in working with many pharmaceutical businesses of all sizes and business models, we can offer you the most comprehensive list of modules that are needed in a pharmacy management system.
The important ones are listed here, with their special features.
Inventory management for pharmacy is different from other businesses in that each article may have different storage emends, shelf life, formulation, and many of them are simply raw materials for producing custom medicines.
A digital record of inventory can help improve your inventory turnover ratios by reducing the average number of days an item is in the storage, before being sold or returned. Data-driven stock level, reorder level, reorder quantity, and identifying the items that have a faster turnover, are all its benefits.
The expired medicines and materials need safe and complete disposal that can be tracked easily via an integrated inventory management module. Stocktaking, physical verification, and stock audits are features of the module.
Many processes in a pharmacy can be automated fully or partially to free up valuable human resources for serving client requirements. Some of the processes that can be automated are:
- Automated medicine dispensers.
- Automate prescription refills.
- Robotic formula compounding and mixing.
- Web-based and IVR order processing system.
- Label printing and packaging.
- Identification of a patient in the CRM.
- Prescription receipt, interpretation, and data entry.
- Clinical review and assessment of prescription for the right dosage, adverse events, or drug abuse.
- Verification of drug information from online pharmacopoeia.
Scheduled prescription automation with centralized patient details can make prescription processing efficient. You can make data-driven decisions related to drug selection, defining refill due dates & dosage, recording prescription filling schedule, and prescription pick-up details. The number of incoming calls from patients to check if their medicines have been prepared will drop significantly as the new automated system can send them alerts over a mobile app, SMS, or email. Timely information to the insurance provider to charge your claim for medicines.
It will also optimize your deliveries and generate a larger volume of prescriptions.
Document and Records Management
Each pharmacy store generates tons of data and a lot of paperwork. All records need to be kept for a very long period, due to regulatory & legal needs. With digital documents and digitization of physical ones, you can save on a lot of paper and the associated problem of losing them.
Some features of the module are:
- Facility to upload medical history, older prescription data.
- Authorized storage, retrieval, and update of medical data & records.
- Share data with auditors and regulators for audit and quality accreditations.
Orders, Returns, and Refunds
The inventory of a pharmacy is full of articles that are bout to expire. If you can find and return them in time, you can save a lot on the dead stock. Similarly, some of your customers will return some products they bought and will expect a refund.
A Point-of-Sale (POS) machine at the checkout can help you manage billings and cash in the pharmacy store. An online pharmacy system must have an integrated payment gateway for secure checkouts and payments.
Analytics and Reporting
Every pharmacy is a trove of complex data related to patients’ medical records, prescriptions, medicines, formulations, and insurance details. Data safety and privacy are paramount and therefore, they must follow federal and international rules governing data protection. This data can be, however, used for analytic and data mining in addition to producing mundane reports. Actionable insights from the data can be used to your advantage in deciding strategies for patient care, service, medicine orders, and forecasting the stock needs for the near future.
With proper analytics tools, you can avoid loss of sales due to shortages, reduce inventory handling costs, avoid dead stock in the form of expired medicines, manage your workflow better.
Revenue Cycle Management
Billing, payments, and accounts receivable are already complex in a regular business, but they acquire a new level in the pharmacy business. Pharmacy billing heavily regulated with manufacturers, suppliers, warehouses, and retailers, everyone needs to keep detailed records of their movement, sale, and returns. An automated system can not only help in daily transaction processing but also manage multiple payers for a bill, insurance reimbursements, generate alerts for delayed payments, and produce a complete trail for identification of cost & profit centres.
Pharmacies need to recognize referrals, get insurance authorization, do claims processing, generate remittance advice, help with benefits pay-outs, and carry out risk mitigation protocols.
With the COVID-19 pandemic scare and the convenience of ordering medicines from the convenience of your home, online pharmacy has become a rage among customers. With the digital transformation of your business, you must be prepared to handle the online requests as easily as you would any walk-in request. An integrated e-commerce module with shipment tracking and a reliable delivery mechanism can set you for good with many customers becoming regulars. A proper back-office with a functional & appealing storefront is part of an online pharmacy store.
Notifications and Alerts
A PMS must generate different kinds of notifications and alerts for staff, managers, patients, and doctors, without compromising safety of a patient’s privacy. The following are some areas where having a notification is important:
Customer care alerts
- Medicine availability.
- Prescription received from doctor’s office.
- Reporting of drug contradiction and allergy.
- Prescriptions ready for pick-up.
- Prescriptions due for refill
- Medication adherence reminders.
- Payments due
- Insurance claim accepted/rejected.
- low stock level alerts.
- Item out of stock alerts.
- Slow-moving items.
- Order placed alerts.
- Order supply received.
- Items about to expire.
- Order payment due.
- Order delayed alert.
- Customer record inconsistencies
- Inconsistencies in a prescription.
- Data entry of medication inconsistent with a prescription.
- Reporting & Analytics:
- Regular reports on stock, sales, cash, etc.
- Clinical performance alerts.
- Administrative performance alerts.
- Up-sell related products
- Loyalty programs.
- Partner network benefit.
- Third-party API Integrations
Multiple third-party software and hardware will be used in a pharmacy. Some of them are:
- Robotic or automated prescription compounding and dispensing
- prescriptions from doctors
- POS devices for billing and sales
- Insurance company API for claims processing
- CRM systems
- eCommerce integration for online pharmacy
- IPD and OPD integration pharmacies running in hospitals.
- Shipping and tracking API for doorstep delivery.
Build v/s Buy
There are many ready-to-use PMS products available. You can download them from their respective websites by paying a one-time license fee or a monthly subscription based on the number of users. Off-the-shelf PMS software products are faster to set up if time is of the essence. But, if you have some weeks till you must implement the software then, you have the choice to build custom software for your pharmacy store. The scope for customization is very limited in the case of a ready PMS product as the software is built for common needs. It means you end up paying for features you will never use and still, you might miss some important modules you needed.
The solution to both the above problems is a custom-build pharmacy management system that will cater to your needs. Too many updates to the ready-made solution would eventually expose it to data breach attacks.
Reasons to build:
- Unique business requirements not served by any existing software.
- Need to grow business rapidly inorganically – by acquiring other stores & chains.
- Ready-to-use solution projects are not very efficient when it comes to scaling the business.
- You can change the designs, add new functionality, and change existing functionality.
- Meeting the most stringent data security and privacy requirements.
Reasons not to build:
- The costlier but wider collection of medicines.
- Access to reputed pharmacopoeia.
- Financial instability.
- Insufficient resources to get custom software built.
Steps to Design a Pharmacy Management System
Here we discuss the steps that you must take to help the development vendor design and create your custom solution to the specifications.
Define business goals
Clear, precise, and measurable business goals like tracking inventory, tracking prescription abuse, cost savings, avoidance of frequent stock shortages are some goals that you may have in your mind.
The end-users, including your staff, doctors, and even regular customer for online pharmacy can offer maximum detail-oriented feedback. Such participation by the end-users will get them invested, making the change management that much easier. Such interactions can bring to fore certain gaps that only a regular user of the systems can find and suggest ways to correct them.
Once the draft System requirements Specifications are designed by the team, you must thoroughly go through each of the modules and their functionality. You can do it on your own or with your team. These observations and insights can be helpful in more than one way.
Starting an online or offline pharmacy store requires tying-up with multiple vendors to order your medicine supply. These are contracts that are enforceable by law.
Once you have signed off on the system design, you must start negotiating data migration. Most systems were manual until a few years ago and some data are partially digitized. As soon as the system is developed, you will need data to test it as well as deploy the final version of the system. Therefore, data migration and loading are vital task that must be taken up in parallel using a simple MS Excel file. The vendor must provide you with a pre-formatted file, where your data can go for direct upload.
Multiple faceted systems
A modern pharmacy management system needs to be ready for today and tomorrow with a multi-faceted approach. We believe for any workable solution the following components will be required:
- Integrated ERP System
- Integrated CRM System
- Web Storefront
- Mobile App
With these options available, any pharmacy can easily scale its business operations, with minimal investments and complexities. The Web storefront and mobile app can be made accessible to both internal users, suppliers, and customers with user-specific features based on login sessions.
These systems can help in all three – B2B, B2C, and B2B2C – models of pharmacy businesses.
Technology Stack for Pharmacy Management Software
The technology stack that we use is highly efficient and used by the best developers to build secure apps and web applications.
- Front End: Angular, HTML, CSS, React, Kotlin/Java, Swift
- Back End: Node.js, Laravel, Python
- Payment Gateway: All leading including PayPal API, Stripe API, Credit cards
- Location Tracking: MapKit Framework, Google Maps, Radar.io
- Notifications: Push notifications, SMS, In-app messaging, email alerts
- Database: PostgreSQL, MongoDB, MySQL, Redis
- Analytics: Google Analytics, Apache Spark, rapid miner
- Mobile App: Swift for iOS app, Kotlin/Java for Android
- Cloud Host: AWS, Google Cloud, Azure
- Social Login: Google, Facebook, Twitter, LinkedIn, etc.
Cost to develop Pharmacy Management Software?
As you have a comprehensive understanding of the need, importance, benefits, and challenges involved in the development of a pharmacy management system, you can appreciate that it is not an easy task to pinpoint the price for such a complex system.
The cost to develop a scalable solution depends on the following factors:
- Integration of ERP and CRM modules
- Third-party API integrations
- Robotics/hardware integrations
- Mobile app development
- Desktop and/or web application development
- Data migration charges
- Maintenance and support.
The cost of the software can be calculated with a proxy by the cost of the technical man-hours devoted to developing the solution.
A team made up of a Project manager, mobile app developers, database & cloud engineers, UI/UX engineers, quality assurance & testing engineers, and data migration engineers will be devoted to the project. We expect they will need between 625 to 700 man-hours.
Now, taking into consideration the minimum, maximum, and average hourly rates in different geographies, we can come to an estimate of the costs:
|Geography||Hourly rate (USD)||USD Cost @ 625 hours with AR||USD Cost @ 700 hours with AR|
Any software system is as good as it is used and with the right inputs from your side, we are certain that the expert team of Arka Softwares can meet and exceed all your requirements. We strive to deliver the right fit to match your needs for today while keeping enough scope in the system to handle the increased pressures of tomorrow.
With the 24×7 support, that team Arka Softwares can offer nothing can go wrong, and even if it does, then we can fix it in no time. Then what are you waiting for, click the link below and fill in your query so that our pharmacy domain expert can connect with you and gather your requirements?
Rahul Mathur is the founder and managing director of ARKA Softwares, a company renowned for its outstanding mobile app development and web development solutions. Delivering high-end modern solutions all over the globe, Rahul takes pleasure in sharing his experiences and views on the latest technological trends.