What does it cost to redispense unused medications in the pharmacy? A micro-costing study

A micro-costing study was performed in four hospital-based outpatient pharmacies in the Netherlands between February and June 2016. Micro-costing studies comprise the detailed identification and measurement of all process steps and resources used for an intervention, in this case redispensing, which are subsequently quantified into costs [14]. In this study, a healthcare provider’s perspective was used, for which only the provider’s (pharmacy) costs in the redispensing process were considered. The economic analysis was performed according to Dutch pharmacoeconomic guidelines [15].

An important prerequisite for redispensing unused medications is a guaranteed product quality. To ensure proper storage of medications at patients’ homes, various criteria should be monitored, such as storage temperature, light and humidity exposure and package integrity (unopened, intact). In addition, the medication should have a sufficient long shelf life (here, an expiry date at least 6 months in the future) [10]. It was assumed that an additional outer package (i.e. transparent seal bag) combined with manufacturer’s original primary and secondary packaging would be sufficient to ensure proper storage in terms of light and humidity exposure. This would also facilitate the assessment of the package integrity if the seal is unbroken, ensuring that the package remains unopened and undamaged.

Two types of medications were distinguished based on their storage recommendations; medications requiring storage at room-temperature (15–25 °C) and medications requiring refrigeration at (2–8 °C). Previous research has shown that medications requiring room-temperature storage are generally stored at an appropriate temperature, whereas medications requiring refrigeration are often stored outside the recommended temperature range, including below 0 °C [16, 17]. Therefore, for medications requiring refrigeration detailed temperature information is needed to assess proper storage. It was assumed that a digital temperature measurement logger system would be needed to measure temperature constantly for these medications, but that a simple indicator that indicates out-of-range temperatures (for example, by changing colour) would be sufficient for monitoring storage temperature of medications requiring room-temperature storage.

To identify all the additional process steps and resources on top of standard pharmacy practice needed to redispense unused medications, pharmacy staff from the participating four pharmacies were interviewed. The researchers composed a list of the expected process steps and materials required, which was sent to the pharmacists prior to the interview, and the pharmacy staff was asked to adjust the list, adding or excluding steps and materials, and to identify the type of pharmacy staff (e.g. technician or pharmacist) involved in each step.

The identified process steps were simulated in each pharmacy by staff and a researcher recorded the time taken for each step. The simulation was performed three times in each pharmacy. The last simulation in each of the four pharmacies was considered most accurate and therefore used in the analysis (see Table 1 for the process steps and time). Process steps that differed between medications stored at room-temperature or under refrigeration were simulated separately.

Direct and indirect costs were calculated for all additional process steps and resources. Direct costs were defined as the pharmacy’s additional costs made during the redispensing process, including labour and materials. Labour costs were calculated for each process step by multiplying the mean time by the costs of the type of pharmacy staff involved, based on the median annual salary reported by the Royal Dutch Pharmacists Association [18]. Salary scales were converted to a per-minute rate based on 1558 working hours per year and a 36-h working week [19]. The salary was increased with 39% to account for social charges [19]. Material costs were calculated using purchase prices. For medications requiring refrigeration, the purchase prices of the digital recording system were included, assuming a life span of 3 years and six uses of the logger. Indirect costs were defined as the pharmacy’s overhead costs made through the employment of staff, the operating activities of the facility and the quality assurance. The overhead costs were valued at 44% of the direct costs [19]. All costs are reported in Euros (2016) and were adjusted using inflation rates where needed [20]. Detailed information on the source of cost information is presented in Table 2.

To determine the price level that indicates the price of a single medication package that would be financially eligible for redispensing, a general model was constructed for different scenarios. This model was based on the following assumptions: fixed calculated labour- material- and overhead costs (Table 1), variation in the proportion of medication packages that are returned to the pharmacy (between 1 and 10%) and variation in the proportion of returned medication packages that fulfil all quality criteria (between 20 and 80%). For medications requiring refrigeration, the proportion of loggers that were returned as normal care was set as 77%, the proportion returned by post as 4 and 19% of the dispensed loggers were assumed not to be returned and lost that should be extra purchased (based on personal communication with Vlieland et.al.). To define a base case, the number of medication packages for one therapeutic class dispensed in one pharmacy in 1 year was in this study set as 10,000 (100%). Total costs were calculated and divided by the proportion of returned medication packages that were assumed to fulfil all quality criteria, and as follows the price level for the price of a single medication package was estimated (see Table 3 for example). For estimating the price level the following formula was used:

In addition, the number needed to dispense (i.e. the number of dispensed medication packages that are needed in order to restock one medication package) was calculated for each scenario to indicate the number of medication packages that needed to obtain benefits from redispensing. Therefore, the number of dispensed medication packages was divided by the number of medication packages that returned to stock.

Data were entered into Microsoft Excel 2010 and descriptively analysed. Averages were expressed as means with standard deviations (SD) or their minimum and maximum values, and proportions were reported as percentages.

To identify the additional process steps and resources required to redispense unused medications in the pharmacy, six interviews were held with eight pharmacists and one pharmacy technician (three interviews were held with two employees simultaneously). During the sixth interview, no new process steps were identified and the composed list was therefore considered comprehensive. Overall, three main process steps were identified in redispensing unused medications in the pharmacy: (1) add materials required for monitoring home storage during the initial dispensing process; (2) assess the quality of the medications returned unused to the pharmacy in terms of temperature storage, package integrity and expiry date; and either (3a) place medications that fulfils all quality criteria into the pharmacy stock or (3b) dispose of medications that not fulfils the quality criteria. As a fourth step for refrigerated medications, patients that use their full medication course would be requested to return the temperature loggers by post (4a) or during their regular pharmacy visit (4b) for reuse. For a general overview of the redispensing process see Fig. 1, and for the process steps see Table 1.

The total time required to perform all process steps up to restocking one medication package was on average 5.3 (SD ±0.3) minutes if requiring room-temperature storage and 6.8 (SD ±0.3) minutes if requiring refrigeration (Table 1). Similar outcomes were found if a medication package would ultimately be disposed of, respectively 5.2 (SD ±0.4) minutes and 6.7 (SD ±0.5) minutes. Time differences between room-temperature stored medications and those requiring refrigeration were a result of time required for temperature logger activation and assessment compared to the temperature sensor. For both medication types, more than half of the time was spent on the quality assessment of returned medications.

The costs associated with all process steps and resources, including direct labour- and material costs and indirect overhead costs, required to ultimately return one medication package to stock was €5.54 if requiring room-temperature storage, while these costs were €7.61 for a package requiring refrigeration (Table 1). Similar costs were found if the package would ultimately be disposed of.

The price level of a single returned medication package making redispensing cost-beneficial varied strongly for the different scenarios and decreased when more medications that met the quality criteria would be returned unused to the pharmacy (Fig. 2). For instance, if 5% of the dispensed medication packages would be returned to the pharmacy, of which 60% would fulfil the quality criteria, the price level would be €101.00 per package for medications requiring room-temperature storage and €215.00 for those requiring refrigeration. However, if 10% would return to the pharmacy, of which 60% would fulfil the quality criteria, the price level decreases to €53.00 and €109.00, respectively. Overall, the price level is lower for medications that require room-temperature storage compared to those that require refrigeration.

The number needed to dispense decreased if more medications would return to the pharmacy (Fig. 3). As an example, if 5% would be returned to the pharmacy, of which 60% would fulfil the quality criteria, 33 medication packages needed to be dispensed to allow for restocking of one package.

The main strength of this study is the use of a micro-costing approach, which is the most comprehensive and precise method to estimate the costs of an intervention [14]. The study also has some limitations. Primarily, this is a simulation study and the process steps that were identified may differ if redispensing is implemented in real practice. However, redispensing is not routinely performed in the pharmacy and therefore these simulations enabled a detailed estimation of the time and resources involved, which was required to calculate the costs. Furthermore, pharmacy staff was not experienced in simulating the process steps, which may have resulted in increased times. Most process steps were similar to the normal pharmacy practice, and three consecutive simulations were performed to increase their experience, of which the last was considered most accurate. It can be assumed that the number of simulations performed by the pharmacy technicians was sufficient to simulate real practice. It was not possible to simulate stock adjustments and communication with the financial department, and no training of the pharmacy staff was included in the analysis. This may have resulted in lower estimations of the time and cost, and ultimately in an underestimation of the price level. However, this would not have altered our general findings that only expensive medication packages are eligible for redispensing. In addition, a healthcare provider’s perspective was used for the cost estimates, and no societal costs were taken into account. In our view, redispensing requires limited effort from society, other than the patients returning their unused medications to the pharmacy. Most patients visit their pharmacy regularly and one can assume that returning unused medication would not result in additional visits. Finally, this study was performed in a Dutch outpatient pharmacy setting and as such, the outcomes may be less generalizable to other countries. We believe that the identified process steps will be similar between countries, however, the unit costs that were included in the analysis may vary. The proportion of dispensed packages that remain unused and are returned to the pharmacy may depend on national prescribing and dispensing policies. Therefore, a general model with various scenarios was build that can be used in different settings as an indicator to determine the price level of medications eligible for redispensing. This model is the best case scenario model and in the real world practice there are some more assumptions and different probabilities which can make these estimated costs higher.