Medical Readiness:

DOD Can Improve Management of Dated Drug Items Held as War Reserves

NSIAD-87-38: Published: Jan 9, 1987. Publicly Released: Jan 9, 1987.

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Martin M. Ferber
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GAO reviewed the Department of Defense's (DOD) handling of dated medical supplies held as pre-positioned war-reserves (PWR), specifically DOD implementation of several proposals to reduce replacement costs.

GAO noted that, if all the military services stocked a 60-day supply of dated medical supplies, the total inventory would probably exceed $390 million by the mid-1990's, with annual replacement costs of over $110 million if the services do not implement cost-reduction efforts. GAO found that: (1) since the services have not stocked their full 60-day supply, replacement of dated PWR items cost about $9 million in fiscal year 1985; (2) DOD has several proposals for reducing replacement costs and making better use of dated medical supplies, including extending shelf-life, stocking a specified quantity of each item, and rotating more items; and (3) although the proposals have a high potential for reducing costs, DOD has not formulated a plan to ensure evaluation and implementation of the proposals in a systematic and timely manner.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: A formal plan of action was developed as part of the Medical Readiness Strategic Plan. The plan was published on May 9, 1988. This action provides evaluation and implementation milestones.

    Recommendation: The Secretary of Defense should direct that a plan of action be established to reduce the replacement costs of dated PWR medical items.

    Agency Affected: Department of Defense


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