How Pharmacy Leaders Are Rewriting the Supply Chain Playbook

Pharmacy supply chain transformation at IU Health

When Derek Imars, PharmD, MBA, BCPS, joined Indiana University (IU) Health as Executive Director of Pharmacy Supply Chain last year, he set out to build a comprehensive roadmap for the future. His vision: A pharmacy supply chain that integrates all decisions under one strategy and provides the infrastructure needed to fully support a clinically integrated supply chain.

“We’re working to centralize purchasing and ensure that if inventory is managed through our consolidated service center (CSC), it’s the slow-moving items most prone to expiration,” Dr. Imars explained. 

“We’re also insourcing shortage mitigation by creating critical product lists—defining the items essential to running a hospital—and strategically sourcing six months of supply, whether through a group purchasing organization (GPO) run program or direct allocations.” This approach, he added, is both cost-effective and foundational to long-term resilience.

Dr. Imars compared pharmacy’s progress to that of the medical/surgical supply chain. Over the past 25 years, medical/surgical supply chain stakeholders have led the way in areas such as enterprise resource planning (ERP) system integration, standardized contracting, centralized purchasing, and data-driven decision-making. These practices, he noted, have consistently driven savings for health systems. 

“When I look across the aisle at the medical/surgical supply chain, I see opportunities to take pieces of what they’ve perfected and adapt them for pharmacy workflows,” he said. “It can be a culture shock for pharmacy leaders, but it’s where we need to go.”

At the same time, Dr. Imars believes medical/surgical supply chain teams can learn from pharmacy. While most have only recently advanced toward clinical integration, pharmacy has operated as a clinically integrated supply chain for decades. 

“Pharmacists are often viewed as clinical facilitators, but our identity is broader than that—we’re also supply chain managers,” he said. “When we bring that expertise forward, the benefits are significant. Pharmacy has been practicing clinically integrated supply chain management for 25 years or more, long before it became a buzzword.”

Collaboration between the two supply chain teams has been key at IU Health. Dr. Imars meets monthly with medical/surgical supply chain partners to align on overlapping product categories, such as IV fluids and surgical items. 

“If we don’t channel products through the right distribution pathway, it can create confusion for caregivers and lead to issues with contracts, vendors, and purchasing,” he said. “By right sizing our portfolios together, we’re eliminating redundancies and creating clarity.”

Beyond collaboration, IU Health has taken a holistic approach to pharmacy supply chain optimization, investing in infrastructure and technology to support all classes of trade—from acute care to retail, specialty, and infusion.

In acute care, where bundled payments make cost reduction essential, the focus is on savings strategies. In retail and specialty pharmacy, growth opportunities are prioritized to strengthen margins. A centralized compounding team plays a pivotal role across both domains, flexing from routine production to shortage mitigation. During the Baxter IV shortage, for example, IU Health was able to repackage products internally, avoid surgery cancellations, and preserve revenue.

Dr. Imars is also preparing his team for broader market and regulatory pressures, particularly in infusion services. The Centers for Medicare & Medicaid Services (CMS) CY 2026 Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System proposed rule includes updates to Medicare payment policies and rates for hospital outpatient and ASC services.

OPPS rule and payer mandates are accelerating the shift from hospital outpatient departments (HOPDs) to lower-cost infusion settings, such as ambulatory clinics and home care. 

“The pressures are very real,” he said. “We’re building a central access team to work with physicians on referrals and payer requirements, ensuring patients can transition smoothly while keeping care within our system.”

Finally, IU Health continues to optimize its participation in the CMS 340B Pricing Program, partnering with a third-party administrator (TPA) and leveraging software to ensure compliance while aligning product distribution with the right site of care.

For Dr. Imars, the future of pharmacy supply chain lies in this balance: Adopting the medical/surgical supply chain’s data-driven efficiencies, elevating pharmacy’s long-standing clinical integration, and fostering collaboration across teams. The result is a model that not only reduces costs and mitigates shortages but also strengthens the connection between supply chain performance and patient care.

Industry insights on pharmacy supply chain optimization

Service and solutions providers in the pharmacy supply chain space offered their insights on the current environment and what health systems and hospitals need to optimize pharmacy operations.

Valerie Bandy, PharmD, vice president of Pharmacy Solutions at Tecsys

“Pharmacy supply chain is growing into an advanced practice. If you’re not keeping up, you’re missing cost savings, efficiencies and compliance gains. Investing here means closing regulatory gaps, automating the routine, and freeing staff to focus on patients.

“The real win in optimizing your supply chain is letting people do the work that matters. When you automate and optimize the repetitive tasks and link supply chain to clinical goals, you give staff the space to focus on safety, care and operating at the top of their license.

“We’re seeing new titles emerge — pharmacy ops strategy, revenue cycle, and finance, pharmacy IT. It’s a really important shift for the industry. What it shows is that pharmacy leadership is expanding, blending deep clinical and operational knowledge with supply chain expertise to manage everything end to end. That combination is what’s driving better control, efficiency and patient safety."

Tecsys helps health systems optimize pharmacy supply chains by improving visibility, control, compliance and patient safety. From centralized procurement to efficient replenishment, Tecsys solutions reduce waste, cut costs and strengthen regulatory readiness. At the core is Elite for Pharmacy, which applies proven healthcare supply chain practices with advanced tools like predictive analytics, shortage and recall management, expiration monitoring and support for DSCSA and 340B. The result is a reliable, cost-efficient pharmacy supply chain that minimizes risk and frees resources to advance patient care.

Lani Bertrand, RPh, senior director, Clinical Marketing & Thought Leadership, Omnicell

“Despite advances in medication management technology, many health systems still struggle with visibility into medication inventory and use. As telehealth and virtual care shorten hospital stays, medications move through more locations than ever, making it difficult to maintain a clear, end-to-end view from admission to discharge.

“Hospitals are also managing a mix of new digital solutions, outdated software, and standalone dispensing tools that don’t always work together. This creates data silos, making it hard to assess inventory enterprise-wide or use patient information to anticipate needs. Growing drug shortages add another challenge, complicating demand forecasting and procurement optimization, often leading to costly and wasteful stockpiling.

“Closing visibility gaps starts with addressing fragmented technology. Pharmacy teams need easy access to details such as which medications are about to expire, where stock-outs are occurring, and where medications are stored across the health system. Achieving this requires system connectivity and consolidation so all inventory data is accessible in one place.

"With the launch of OmniSphere, a secure, cloud-native platform that connects Omnicell devices to unify medication management, we’re creating a safe, intelligent, and integrated ecosystem. Built on scalable infrastructure and world-class cyber and data security, OmniSphere provides pharmacies with a single access point and source of truth for inventory data. Centralizing this information enables real-time optimization, more efficient workflows, and more informed decision-making by integrating data from connected automation across care areas.”

Scott Evans, ED, Inventory Count Operations, GHX

“Pharmacy leaders today are facing unprecedented challenges—from drug shortages and rising costs to regulatory pressures and workforce constraints. What we’re seeing is that success requires more than simply keeping shelves stocked; it demands a smarter, more resilient supply chain.

“A growing number of health systems and hospitals are taking strategic steps to gain visibility into their pharmacy inventory, automate drug management processes, and leverage actionable, data-driven insights to help reduce pharmacy waste, improve compliance, and focus on what matters most—delivering safe, reliable care to patients.”

GHX Inventory Count Services provides accurate, process-driven, point-in-time inventory counting and documentation for clinical and pharmacy locations. A full-service project management team helps ensure an efficient count from start to finish supported by on-site credentialed, trained professional GHX employees. A suite of detailed reports provides actionable insights to stock level visibility and inventory valuations helping to inform supply chain purchasing decisions.

Ammie McAsey, president, McKesson Health Systems

“As the role of pharmacy continues to expand across the care continuum, the supply chain must evolve to meet new demands. At McKesson, we’re helping health systems move beyond transactional models to strategic, data-driven partnerships. 

“By leveraging advanced analytics, global supplier relationships, and innovative distribution strategies, we’re building resilient, responsive supply chains that reduce waste, increase visibility and improve patient outcomes. It’s about enabling pharmacy to do more—clinically and operationally—for the advancement of patient health.” 

Tom Strohl, president of Oliver Wight Americas

“One of the biggest challenges is the fragility of the generics supply chain. Generics represent approximately 90% of all prescriptions filled. Margins are thin compared to their branded counterparts, creating the need for careful management of their supply chain and working capital. Only about 12% of active pharmaceutical ingredients are produced domestically, which means pharmaceutical companies are heavily reliant on offshore manufacturing.⁶

“This creates significant risk—minor disruptions like shipping delays can quickly escalate into drug shortages and increased costs for both hospitals and patients. While offshore production was once considered more cost-effective, it often hides broader issues such as long lead times, logistical complexity, inventory risk, and tariffs. The pandemic highlighted how a ‘low-cost’ strategy can undermine resilience and patient access to medicines.”

Oliver Wight helps its pharmaceutical clients adopt an Integrated Business Planning (IBP) approach. IBP provides a structured view into future requirements and a way to evaluate tactical decisions not just by cost, but by their impact on resilience, service levels, and long-term sustainability. With better visibility across the supply chain and clearer understanding of tradeoffs, companies can make more informed decisions that improve reliability and protect patient access to essential medicines.

Mittal Sutaria, senior vice president, contract and program services, pharmacy, Vizient

“In 2023, hospitals spent nearly 20 million labor hours managing drug shortages, costing almost $900 million—more than double 2019 levels. These shortages are no longer isolated events; they drain budgets, burden operations and impact patient care. The future of the pharmacy supply chain must be built on resiliency through transparency, proactive sourcing, and strategic solutions—such as those that increase supply with access to pooled or dedicated inventory in times of disruption—to help health systems safeguard essential medications and ensure continuity of care.”