This research discusses the management of drug inventory in a regional public hospital in Indonesia that is carried out to support the government's target regarding 95% of inventory in hospitals and health centers has to be fulfilled. The object hospital of this research also has two main targets in the drugs inventory management, namely quality control and cost control, both of which can be achieved by the efficient management of the drug inventory. One of the strategies to obtain it is to plan an efficient decision on the quantity (Q) of ordered drugs and the order time (T) to achieve minimum total cost of the drugs inventory management and the demand for drugs from patients is fulfilled. The hospital is important to carry out drug inventory management since the nature of this product is easily expired, storing excessive amounts of drugs could lead to deadstock. On the other hand, having shortages of drugs could be very dangerous for the patient who needed it. The method applied in this research is the ABC classification to determine the level of drug usage within one year and Mixed Integer Linear Programming (MILP) to obtain the minimum cost of the drugs inventory management. The results of this research are 50 types of drugs that categorized as category A from 526 drugs in the hospital, quantity of order (Q) of drugs, arrival lead time of drugs (T), the total cost of the 10 drugs inventory management from classification A which was reduced by IDR36.899.512 from the actual conditions, and this research also comparing the results of two mathematical models that consider and do not consider the drug expiration factors.