Health Commodities and Services Management (HCSM) Program

In Kenyatta National Hospital, a leading hospital in Kenya, over 30% of expenditure is currently allocated to medicines, and this needs to be optimally managed. We used inventory control techniques, ABC (Always, Better, and Control), VEN (Vital, Essential, and Non-essential) and ABC-VEN matrix analyses to study drug expenditure patterns. Of an average of 811 medicine types procured annually, 80% were formulary drugs and 20% were non-formulary. Class A medicines constituted 13.2–14.2% of different medicines procured each year but accounted for an average of 80% of total annual drug expenditure. Class B medicines constituted 15.9–17% of all the drugs procured yearly but accounted for 15% of the annual expenditure, whilst Class C medicines constituted 70% of total medicines procured but only 5% of the total expenditure. Vital and essential medicines consumed the highest percentage of drug expenditure. ABC-VEN categorization showed that an average of 31% of medicine types consumed an average of 85% of total drug expenditure. Therapeutic category and morbidity patterns analysis showed a mismatch between drug expenditure and morbidity patterns in over 85% of the categories. We concluded that Class A medicines are few but consume the largest proportion of hospital drug expenditure. Vital and essential items account for the highest drug expenditure, and need to be carefully managed. ABC-VEN categorization identified medicines where major savings could potentially be made helped by therapeutic category and morbidity pattern analysis. There was a high percentage of non-formulary items, which needs to be addressed. Inventory control techniques should be applied routinely to optimize medicine use within available budgets, especially in low- and middle-income countries.

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