What is the purpose of group purchasing organizations (GPO) in a pharmacy context?

The primary role of group purchasing organizations (GPOs) in a pharmacy context is to negotiate discounts for high-volume purchases. GPOs leverage the collective buying power of multiple pharmacies or healthcare providers to obtain more favorable pricing from manufacturers and suppliers. This reduces costs for individual pharmacies, allowing them to acquire medications and other products at lower prices than if they were purchasing independently.

By aggregating demand, GPOs can secure better terms and conditions, benefiting their members with significant savings. This is particularly important in the pharmacy setting where margins can be tight, and the ability to reduce purchasing costs can directly impact a pharmacy's profitability and ability to serve the community.

While streamlining inventory management can be a benefit of using a GPO, the primary function centers around negotiating discounts, making that the most relevant choice in this context. The other choices, such as decreasing competition or increasing pricing, do not align with the fundamental goal of GPOs, which is to support their members in obtaining necessary products at a lower cost.