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Automation eases growth process

08 November 2016

Pharmacy2U is a fast-growing online pharmacy and recently moved to a new Leeds DC, kitted out by Logistex. HSS editor Simon Duddy gets a tour of the facility from chief operating officer Daniel Lee.

The company got going 16 years ago, starting at the back of a regular pharmacy. As the world of online delivery has grown, so has Pharmacy2U - in leaps and bounds. The organisation has moved several times and recently moved into a substantial distribution centre in Leeds, with approximately 650 sq m of storage and picking space, that will allow them to despatch one million prescription items a month.

Chief operating officer Daniel Lee says the move to online has meant they have re-engineered the pharmacy model from the ground up.

“Each time we’ve moved, we’ve looked at our processes, systems and equipment handling, to see how we could make the business more efficient. Ultimately it has been about trying to drive the lowest cost pharmacy fulfillment platform because we - within our NHS margins - fund the delivery cost associated with that.”

In essence, as the operation increased in scale, further automation became necessary to manage costs. Aside from its dispensing robots, all operations were manual in the previous warehouse. This meant the move to the new facility was a very significant leap for the company.

“Three years ago we contacted a consultancy, The Logistics Business, and put together a tender document, outlining the kind of kit we thought we could deploy,” says Daniel. “Every part of our manual operations were revisited, the output per person, per operation was investigated, and a material flow analysis was produced for every part of the business. We looked at A-Frames, dispensing robots, conveyors, sorters, Pick-by-light and we put together a business case for the investment based on the efficiencies anticipated.”

The business case rested on a three year payback with more than a 50% improvement in efficiencies.

Pharmacy2U spoke to six integrators as part of an in-depth tender process who were whittled down to two suppliers after three months.

“We worked with this pair exclusively for a number of months, met the project teams, worked out pricing mechanisms and worked on designs. In the end, it was a close affair and Logistex came out on top – right from the senior team they were more committed and their design was more innovative.”

Pharmacy2U was keen on staying with its dispensing robots, albeit with an updated version. These pick prescription items housed in a secure medicine cabinet. The automated twin headed Rowa Vmax Duplo robots are supplied by Becton Dickinson and provide fully automated storage and retrieval / put away and dispensing of pharmaceutical product.

“The robot dispensers were always going to be the heartbeat of the system,” says Daniel. “But for faster moving items we use Pick-by-Light, while for some items such as bottles and dressing we retain manual picking.”

The order journey

When an order is received, the host system processes this, with a pharmacist carrying out a clinical check up front.

The order is then allocated to the Reflex WMS supplied by Logistex, which manages the warehouse process up to despatch.

The integration between the clinical IT system and WMS was challenging.

“The link up between Reflex and our pharmaceutical system delves right into the heart of it. Apart from project managing the installation of the equipment, this is probably the hardest bit to get right, and it is absolutely crucial to the smooth running of the operation,” explains Daniel.

When an order arrives with the Reflex system, a tote travels by conveyor (550m used in total) to the manual picking area first. The tote then travels via a spiral conveyor to a mezzanine level where the dispensing robots are located. 

Reflex notifies the third party system that runs the CareFusion product, to tell it to pick the items that are in the robot, and deliver them to the drop points in the system. They are four drop points currently and the tote can go to multiple drop points to complete the order.

The tote then travels to the Pick-by-Light area for the fastest moving items. 

The order then goes into the clinical room for labelling. A split pack might be dispensed, which involves the operative tailoring a pack precisely to the doctor’s prescription.

“Some items have to be picked manually,” says Daniel. “And some items require a human intervention. It could not all be automated, we are a pharmacy at the end of the day, and we need to have clinical checks as part of our process.”

78% of orders are sent out through the carton closing system from B+ Equipment (handling around 580 packs an hour), while some orders are over- or under-sized.

Some of the orders are live and require temperature control. For these items, WoolCool packaging is guaranteed to maintain temperature for 48 hours. All deliveries are Royal Mail tracked on a next day service.

Daniel says: “We are delighted with our packaging system. It gives our parcels a very professional image with a consistency of packaging and a clean look and finish. 

It folds the cardboard over the height of the pack, giving a firm feel, with no void fill. We’ve also got the footprint down on the packaging machinery we use.”

The Pick-by-Light area is where the company has its top 30 lines by volume and it’s a much quicker pick (3-5 seconds) as opposed to 10-15 seconds from the robot.

“We briefly looked at voice picking,” says Daniel. “But it was complicated around drug names, Pick-by-Light was a proven technology and we wanted a robustness we could reply on.”

The approach is now much more mechanical and efficient.

As well as driving efficiencies, Daniel and Logistex spent a lot of time and energy making the picking process as accurate as possible.

“We created a patent-pending barcode verification process,” says Daniel. “The triple barcode verification process checks the order against the drug, prints a clinical label to go on the medicine (with barcode as well). This is then verified against the product barcode, to confirm the label goes on the right pack in the right order.”

This gives Pharmacy2U a very high level of clinical accuracy - 99.98%, which is industry leading. The company has carried out audits to confirm the accuracy of the process.

As multi-item orders are common, consolidation is built into the system. Managed by the Reflex WMS, the tote travels to different picking areas to pick up items, which are verified as they make their journey. See box for a breakdown of the order journey in the warehouse.

Volume growth

The facility was built to handle a tenfold increase on starting volume.

Daniel explains: “We talk of in terms of items dispensed - this facility can handle up to 1 million items per month, something like 135 times the average pharmacy. We’ve seen some 56% growth in last four months and dispensed 105,000 items last month.”

The facility was tested - and contractually agreed upon - a maximum throughput of 605 orders per hour. This has been surpassed in testing and Daniel feels more can be achieved with a few tweaks of the system.

It is anticipated the facility will reach its 1m items dispensed ceiling within three or four years. As the facility grows, more equipment – for example packing machines and dispensing robots – can be slotted into place in the existing layout.

“If growth keeps building, we will retain this facility and build another, probably in the south of England,” says Daniel. “At 605 orders per hour, over a 16 hour shift pattern, we will accommodate the kind of growth we anticipate. Our ROI is three years and we are ahead of schedule, we are achieving a 60% reduction in the cost of dispensing. I would expect that to increase as we’re still not near reaching our capacity.”