The pharmaceutical inventory management process adopted by the hospitals are facing challenges in data communication, which implied to excess inventory problems as the leading cause of bad forecast of their lack. This study aims to redesign the information flow and business process in the pharmaceutical inventory management by increasing its efficiency by implementing Vendor Managed Inventory (VMI) supported by the Internet of Things (IoT). Business Process Re-engineering (BPR) and Structured System Development (SSD) as a method used in this study.  Four stages of SSD consist of structuring Entity Relationship Diagram (ERD), relational table, use case diagram, and Data Flow Diagram (DFD) for process improvement. This study proposed five improvement scenarios simulated using iGrafx. The best scenario for the hospital to consider in conducting improvement is VMI intervention, IoT technology in the form of QR Code or RFID Tag, and Hospital Management Information System (HMIS) development. The proposed model resulted in pharmaceutical inventory management's time efficiency to 95.64%, which previously took 22.11 days to 7.72 hours.