; or (ii) may store stockpiled inventory separately in a different location and replace drugs in the stockpile inventory with the same drug with newer dating. (C) Insufficient funds If amounts available to an eligible entity through contracts under this section are not sufficient to acquire or maintain a 6-month supply of any drug in the stockpile of the eligible entity funded under this section, the eligible entity— (i) may acquire and maintain less than a 6-month supply, but in no case less than a 3-month supply; and (ii) shall submit a report to the Secretary identifying— (I) each such drug; and (II) the reasons why such amounts are not sufficient to acquire or maintain a 6-month supply. (D) Annual audits Not more than annually, the Secretary may request a physical audit count of the inventories of all eligible entities with a contract under this section to validate that each such entity is maintaining the appropriate amount of stockpiled inventory. (3) Periodic product review (A) Use of proceeds An eligible entity with a contract under this section for a stockpile of generic drugs at risk of shortage shall use the proceeds of the sale of any drugs in the stockpile to purchase drugs for the stockpile in accordance with this section. (B) Market inflation or deflation In the case of market inflation or deflation affecting the price of a drug in the stockpile of an eligible entity maintained pursuant to a contract under this section, the contract shall ensure that the Federal Government does not profit or suffer loss on items of such drug as a result of such inflation or deflation. (4) Reporting Each eligible entity with a contract under this section shall submit reports at such time and in such manner as the Secretary may require regarding— (A) current inventory levels of stockpiled drugs at a drug level; (B) indicators of current inventory levels of stockpiled drugs relative to acceptable minimums