Prescription Drug Vending Machine

PRESCRIPTION DRUG VENDING
MACHINE
A Entrepreneurship Project Report

Submitted in partial fulfillment of
the requirements for the
Degree of Bachelor of Technology
Under Biju Patnaik University of Technology
By
Priyanka Mohanty Roll #EIE200775162

Sushant Kumar Roll #CSE200710164
Kumar Saurabh Roll # IT200720449
April - 2011
Under the guidance of

Mr. Bhanu Prasad Behera
NATIONAL INSTITUTE OF SCIENCE & TECHNOLOGY

Palur Hills, Berhampur, Orissa - 761 008, India
ABSTRACT
Prescription drug vending machine is a novel way to make getting medications easy.
The vending machines can be designed to be placed in doctors’ offices, clinics,
emergency rooms and other healthcare facilities. Each can hold 100 of some of the
most often used medications that can range from pills to drops to creams and so forth.
The machines require that physicians create prescriptions electronically, which are
then transmitted to the vending location. (Alternately, patients can take printed
prescriptions to their regular pharmacists.) The machines include several safeguards
to insure patients receive the proper medications their doctors ordered. Thus the
ordering process becomes relatively simple. They enter their prescription number and
birthday via a user-friendly touch-screen monitor, then insert either cash or credit
cards to cover co-pays, while their insurance companies are billed automatically. The
most important benefit these machines give is the easy availability of medicines in
times of emergency.
Besides saving time for patients, these machines also save pharmacists the slow and
potentially error-prone process of counting out medications by hand. The vending
machines, can be accessible 24/7, likewise could help alleviate a growing shortage of
pharmacists.
i
ACKNOWLEDGEMENT
We express our deep sense of gratitude to, Mr. Bhanu Prasad Behera, for his
valuable guidance and constant unfailing encouragement for completing this project.
We are also grateful to our friends for tirelessly and patiently pursuing us to finish this
report without whose help completion of the project report was the next thing to
impossible.
Finally, we would like to thank Prof. Sangram Mudali, our respected director, for
providing us proper environment for the completion of the report.
Priyanka Mohanty
Sushant Kumar
Kumar Saurabh
ii
TABLE OF CONTENTS
ABSTRACT....................................................................................................................i
ACKNOWLEDGEMENT.............................................................................................ii
TABLE OF CONTENTS..............................................................................................iii
1. GENERAL INFORMATION....................................................................................5
1.1 Name of the Entrepreneurs:..................................................................................5
1.2 Proposed Project:.................................................................................................5
1.3 Major Product / Services:.....................................................................................5
1.4 Proposed Locations:.............................................................................................5
1.5 Type of Organization:..........................................................................................5
2. ENTREPRENUER PROFILE...................................................................................6
3. TYPE OF THE PRODUCT / SERVICES.................................................................7
3.1 Type of the Project ..............................................................................................7
3.2 Product / Services Description ............................................................................7
3.3 Major Consumers ...............................................................................................7
4. MARKET POTENTIAL............................................................................................8
4.1. Present Demand and Supply of the Product Competition ..................................8
4.2 Target Clients:......................................................................................................8
4.3 Marketing Strategy:..............................................................................................8
5. MANUFACTURING PROCESS..............................................................................9
5.1 Technical Know How Availability: ....................................................................9
5.2 Steps by Step Description:...................................................................................9
5.3 Process flow chart .....................................................................10
Arrangement of all necessary equipments in the proposed location........................10
6. PRODUCTION SCHEDULE..................................................................................11
6.1 Number of Working Days per Annum:..............................................................11
6.2 Number of Working Shifts:................................................................................11
6.3 Installed Capacity (%):.......................................................................................11
6.4 Utilized capacity (%):.........................................................................................11
7. DETAILS OF THE PROPOSED PROJECT ..........................................................12
(A) Land And Building............................................................................................12
(B) Machineries / Equipments................................................................................12
iii
(C) Misc. Fixed Assets...........................................................................................12
(D) Preliminary And Pre-Operative Expenses.........................................................13
(E) Sales Revenue....................................................................................................13
(F) Raw Material (Monthly Requirement)...............................................................13
(G) Utilities – Monthly.............................................................................................13
(H) Man Power (Salaries/Wages)- Monthly............................................................14
(I) Repairs And Maintenance- Monthly..................................................................14
(J) Selling And Distribution Expenses - Monthly....................................................14
(K) Administrative Expenses - Monthly..................................................................14
(L) Interest - Annual.................................................................................................15
(M) Depreciation......................................................................................................15
8. WORKING CAPITAL.............................................................................................16
9. TOTAL COST OF PROJECT.................................................................................17
10. MEANS OF FINANCE.........................................................................................18
11. PROFITABILTY PROJECTIONS ......................................................................19
12. BREAKEVEN POINT..........................................................................................20
13. CONCLUSION......................................................................................................20
iv
PRESCRIPTION DRUG VENDING MACHINE
1. GENERAL INFORMATION
1.1 Name of the Entrepreneurs:
Priyanka Mohanty
Sushant Kumar
Kumar Saurabh
1.2 Proposed Project:
This Business Plan deals in setting up a company for providing drugs(mostly

for lifesaving drugs, essential medicines) through vending machines for the
ease of the customers who wander in the search of medicines . Our firm will
manufacture prescribed drug/medicine vending machine for different
pharmaceutical firms.
1.3 Major Product / Services:
Drug vending machine at Doctors’ offices, clinics, emergency rooms and

other healthcare centers.
1.4 Proposed Locations:
Khurda/Berhampur/Mancheswar
1.5 Type of Organization:
Product based medium scale unit (partnership).
5
2. ENTREPRENUER PROFILE
1. Name : Priyanka Mohanty

Educational Qualification: Bachelor of Technology
Technical Skills: C, C++, VLSI, Sensors, Process Control.
2. Name: Sushant Kumar
Technical Skills: C, C++, Oracle, Java.
3. Name: Kumar Saurabh
Technical Skills: C, C++, Oracle, Java, Advance Java.
6
3. TYPE OF THE PRODUCT / SERVICES
3.1 Type of the Project
Prescription Drug Vending Machine.
3.2 Product / Services Description
With automated facilities targeted mainly at doctors’ offices, clinics, emergency

rooms and other healthcare centers.
3.3 Major Consumers
Pharmaceutical firms and other healthcare centers
7
4. MARKET POTENTIAL
There's a new antidote for long lines at the drugstore pharmacy: machines that serve
up your prescription refills like a can of Coke or a Snickers bar.
The idea behind the machines, which look much like a typical bank ATM, is to
expedite a process that is often bogged down by long lines and frustrating waits.
Once customers have filled an initial prescription with the pharmacist, they can
register to retrieve and pay for their refills at a vending machine inside the store —
even when the pharmacy counter isn't open. A pharmacist then fills the script and
places packaged medicines in the machine. To pick up the order, consumers log on
with a user name and password and swipe a credit or debit card. Their pre-wrapped
package drops into the bin.
4.1. Present Demand and Supply of the Product

Competition
Present demand is there mainly at doctors’ offices, clinics, emergency rooms and
other healthcare centers.. There are no competitors in India as there are no
manufacturers.
4.2 Target Clients:
We are looking forward for major cities of Orissa, West Bengal, Bihar and Andhra
Pradesh.
4.3 Marketing Strategy:
The Marketing Strategy will be advertising the product in the media and by
company’s representatives by visiting various target clients and by making them
aware of the features, application and the type of technology used in product.
Advertisements: –
• Mainly by our representatives
• Free service after sale for 1 year
8
• Free demonstration while launching the product.
5. MANUFACTURING PROCESS
5.1 Technical Know How Availability:
Materials related to embedded systems, VHDL, fundamentals of VLSI, C-

programming, Xilinx, digital electronic circuits, sensors, basics of control systems.
Working platform is Windows XP.
Programming skills like C, C++.
Software used is XPS, ISE XILINX-8.1i, and Chip Scope Pro.
Hardware used is XILINX FPGA (Spartan3, Virtex)
5.2 Steps by Step Description:
1) Design of the cabinet by moulding machines to desirable shape and size.

2) Design of control unit by using the base system builder (BSB) developed
using Xilinx platform studio, sensors developed by the research department
and tested and certified by the quality department of the company.
3) Predesigned 8-bit microprocessor controlled by embedded systems.
4) Assembly of the above sections with the functional and quality testing.
5) Package and storage of the product in the inventories.
6) Supply of vending machines to the vendors and dealers
9
5.3 Process flow chart
START
Arrangement of all necessary equipments in the proposed location
Design of the cabinet by moulding machines to desirable shape and

size.
Design of control unit by using the base system builder (BSB)

developed by the research department and tested and certified by
the quality department of the company.
Predesign 8-bit microprocessor controlled by embedded systems.
Assembly of the above sections with the functional and quality

testing.
Package and storage of the product in the inventories.
Supply of vending machines to the vendors and dealers
STOP
10
6. PRODUCTION SCHEDULE
6.1 Number of Working Days per Annum:
The Firm will remain open for all weekdays except Sundays and National
holidays. Number of working days per annum=300 days.
6.2 Number of Working Shifts:
1 shift
6.3 Installed Capacity (%):
10 machines per day =>3000 machines per annum.
6.4 Utilized capacity (%):
I -year- 40%- 3 machines per day -900 machines per year

II -year- 50%- 4 machines per day -1200 machines per year
III -year- 60%- 5 machines per day -1500 machines per year
11
7. DETAILS OF THE PROPOSED PROJECT
(A) Land And Building
Sr.No. Particular Area Total Value Remarks

Required
1. Land 1.5 acres Rs.45, 00,000
2. Building 1 acres Plant, Rs.30, 00,000

0.25 acres
Admin-office Rs.15,00,000
and 0.25acres
transportation
Total: Rs.90, 00,000
(B) Machineries / Equipments
Sr. Description Nos. Rate Total

No Required (Rs.) Value
(Rs.)
1. Plastic Molding Machines 10 4,00,000 40,00,000

2. Microprocessor kit 200 2600 5,20,000
3. Desktops 30 20,000 6,00,000
4. Display device 150 1000 1,50,000
5. Scanner 150 1400 2,10,000
6. Billing device 150 800 1,20,000
Total 56,00,000
(C) Misc. Fixed Assets
Sr. Particulars Nos. Rate Total

No Require (Rs.) Value
d (Rs.)
1. Office Furniture 1,00,000
2. Furniture for factory canteen 50,000
3. Motor vehicles 2 cars 5,00,000 10,00,000
(For raw material and finished product
marketing) 2 trucks 8,00,000 16,00,000
Total: 27,50,000
12
(D) Preliminary And Pre-Operative Expenses
Sr. Particulars Amount (Rs.)

No
1. Interest during implementation 7,15,688
(initial six months)
2. Establishment Expenses 2,00,000
3. Start-Up Expenses 6,00,000

Misc. Expenses Total 15,15,688
(E) Sales Revenue
Year Items(s) Quantity Rate per Unit (Rs) Sales

Sold/Year Realisation
(Rs)
1. Drug 900 48,000 4,32,00,000
vending
machine
Total 4,32,00,000
(F) Raw Material (Monthly Requirement)
Sr. No Items(s) Quantity Rate (Rs) Total

Value(Rs)
1. 75 5000 3,75,000
Total 3,75,000
(G) Utilities – Monthly
Sr. Particulars Monthly Expenditure (Rs) Remarks

No
1. Power/Electricity 83,333
2. Water 25,000
3. Any other item 16,667
Total 1,25,000
13
(H) Man Power (Salaries/Wages)- Monthly
Sr. Particulars No. Wages/Salaries per Annual

No Month (Rs.) Expenses (Rs)
1. Skilled 10 18,000 21,60,000
2. Semi Skilled 10 12,000 14,40,000
3. Unskilled 50 8,000 48,00,000
4. Office Staff 15 20,000 36,00,000
To 1,20,00,000
tal
(I) Repairs And Maintenance- Monthly
Sr. Particulars Amount (Rs)

No
1. Machinery, Building, Roads, Plant 5,00,000
Total 5,00,000
(J) Selling And Distribution Expenses - Monthly
Sr. Particulars Amount (Rs) Remarks

No
1. Publicity Expenses 33,333
2. Travelling 16,667
3. Freight 4,167
4. Commission 4,167
Total 58,334
(K) Administrative Expenses - Monthly
Sr. Particulars Amount(Rs) Remarks

No
1. Stationery & Printing 16,667
2. Post/Telephone/Fax 8,333
3. Guest Entertainment Expenses 12,500
Total 37,500
14
(L) Interest - Annual
Loan Amount Interest (Rs) Installment (Rs) Balance (Rs)

(Rs)
1,30,12,500 14,31,376 24,00,000 1,20,43,876
Total 1,20,43,876
(M) Depreciation
Sr. Type of Asset Cost of Asset Depreciation Amount

No. (WDV)
1 Buildings 15,00,000 10 % 1,50,000
2 Plant & 30,00,000 33 % 9,90,000

Machinery
3 Moulds and 56,00,000 50 % 23,00,000

Equipments
Total 34,40,000
15
8. WORKING CAPITAL
Sr. Item Rs.

No.
1. Raw-Material 3,75,000
2. Salary/Labour 10,00,000
3. Administrative expenses 37,500
4. Repairs and Maintenance exp. 41,667
5. Selling and distribution expenses 58,334
15,1
Total 2,501
16
9. TOTAL COST OF PROJECT
Sr. No Particulars Total Value

(Rs.)
1. Fixed Capital 1,73,50,000
45,37,503
2. Working capital margin ( One Cycle )
15,15,688
3. Preliminary & Pre-operative Expenses

2,34,03,191
Total
17
10. MEANS OF FINANCE
Sr. No Particulars Percentage of Amount (Rs.)

loan
1. Own Investment 17.98% 23,40,319
2. Term Loan 1,30,12,500
3. Equity 61.86% 80,50,372
Total: 2,34,03,191
Explanatory Note:
• Term loan = Fixed capital x 0.75
• Equity = Total cost of the project- (Term loan + Subsidy + Seed capital)
• Seed capital= Total cost of the project × 0.1
18
11. PROFITABILTY PROJECTIONS
Sr. Particulars Amount

No. (Rs.)
A Annual Sale Realisation 4,32,00,000
B Cost of Manufacturing/ Servicing
i. Raw Materials 45,00,000

ii. Utilities 15,00,000
iii. Salary / wages 1,20,00,000
iv. Selling and Distribution expenses 7,00,000
v. Administrative Expenses 4,50,000
vi. Repairs and maintenance 5,00,000
vii. Interest 14,31,376
viii. Depreciation 34,40,000
ix. Miscellaneous Expenses 27,50,000
Total 3,32,02,752
C Gross Profit/Loss (A-B) 99,97,24

8
19
12. BREAKEVEN POINT
Break Even Point = Fixed Cost x 100

Fixed Cost + Profit
= (1,73,50,000*100)/(1,73,50,000 +99,97,248)
= 63.44%
13. CONCLUSION
20
Our firm plans to expand its business in near future since there is a very good demand
in entire country and also in overseas. This is new concept of dispensing medicine to
consumers through ATM like machine. The export policy of the Govt. is very much
friendly to low and medium scale manufacturers. So, we have decided to export our
products by collaborating with our off shore partners. Our company is expected to
return the initial investment in 3 years. We are also trying to increase our range of
packaging by providing different medicines in different packages.
21

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PRESCRIPTION DRUG VENDING

A Entrepreneurship Project Report

Priyanka Mohanty Roll #EIE200775162

Under the guidance of

NATIONAL INSTITUTE OF SCIENCE & TECHNOLOGY

1.1 Name of the Entrepreneurs:

1.2 Proposed Project:

This Business Plan deals in setting up a company for providing drugs(mostly

1.3 Major Product / Services:

Drug vending machine at Doctors’ offices, clinics, emergency rooms and

1.4 Proposed Locations:

1.5 Type of Organization:

Product based medium scale unit (partnership).

1. Name : Priyanka Mohanty

3. TYPE OF THE PRODUCT / SERVICES

3.1 Type of the Project

Prescription Drug Vending Machine.

3.2 Product / Services Description

With automated facilities targeted mainly at doctors’ offices, clinics, emergency

3.3 Major Consumers

Pharmaceutical firms and other healthcare centers

4.1. Present Demand and Supply of the Product

4.2 Target Clients:

4.3 Marketing Strategy:

• Free demonstration while launching the product.

5.1 Technical Know How Availability:

Materials related to embedded systems, VHDL, fundamentals of VLSI, C-

5.2 Steps by Step Description:

1) Design of the cabinet by moulding machines to desirable shape and size.

5.3 Process flow chart

Arrangement of all necessary equipments in the proposed location

Design of the cabinet by moulding machines to desirable shape and

Design of control unit by using the base system builder (BSB)

Predesign 8-bit microprocessor controlled by embedded systems.

Assembly of the above sections with the functional and quality

Package and storage of the product in the inventories.

Supply of vending machines to the vendors and dealers

6.1 Number of Working Days per Annum:

6.2 Number of Working Shifts:

6.3 Installed Capacity (%):

10 machines per day =>3000 machines per annum.

6.4 Utilized capacity (%):

I -year- 40%- 3 machines per day -900 machines per year

7. DETAILS OF THE PROPOSED PROJECT

(A) Land And Building

Sr.No. Particular Area Total Value Remarks

2. Building 1 acres Plant, Rs.30, 00,000

(B) Machineries / Equipments

Sr. Description Nos. Rate Total

1. Plastic Molding Machines 10 4,00,000 40,00,000

(C) Misc. Fixed Assets

Sr. Particulars Nos. Rate Total

(D) Preliminary And Pre-Operative Expenses

Sr. Particulars Amount (Rs.)

2. Establishment Expenses 2,00,000

3. Start-Up Expenses 6,00,000

(E) Sales Revenue

Year Items(s) Quantity Rate per Unit (Rs) Sales

(F) Raw Material (Monthly Requirement)

Sr. No Items(s) Quantity Rate (Rs) Total

(G) Utilities – Monthly

Sr. Particulars Monthly Expenditure (Rs) Remarks