making prefabs at runtime?

Here i have an inventory script that i've been working on. It works fine, but when i drop an object, its dropping an instance of it (a clone), and when i go to pick it back up, i can't re-drop it since its a clone, not a prefab. Can i make a prefab of it at runtime? Here's code: function InventoryRay() {

 var hit : RaycastHit;
 
 Debug.DrawRay(transform.position, transform.forward * rayLength, Color.red);
 
 if(Physics.Raycast(transform.position, transform.forward, hit, rayLength))
     {
         if(Input.GetMouseButtonDown(0))
         {
             if(hit.collider.gameObject.tag == "collectable")
             {
                 Debug.Log("collectable");
                 currentGameObjectName = hit.collider.gameObject.name;
                 Debug.Log(currentGameObjectName);
 
                 menuItems.Add(currentGameObjectName);
                 itemToDestroy = GameObject.Find(currentGameObjectName);
                 Destroy(itemToDestroy);
             }
         }
     }
 
 
 }
 
 function OnGUI() {
     
     buttonPosX = 10;
     
     buttonPosY = 10;
     
     if(openInventory == true)
     {
         
         GUI.Box(Rect(0, 0, Screen.width/2, Screen.height/2),"INVENTORY");
         
         for(items in menuItems)
         {
             if(GUI.Button(Rect(buttonPosX, buttonPosY, 100, 50), items))
             {
                 openSubMenu = true;
                 currentItem = items;
             }
             
             buttonPosX = buttonPosX + 125;
         }
         
         if(openSubMenu == true)
         {
             SubMenu();
         }
     }
     
 }

function SubMenu() {

 var btnHeight = 50;
 var btnWidth = 50;
 var boxHeight = 150;
 var boxwidth = 250;
 GUI.Box(Rect( (Screen.width/2) - (boxwidth/2), (Screen.height/2) - (boxHeight/2), boxwidth,boxHeight), "what do you want to do?");
 
 if(GUI.Button(Rect((Screen.width/2) - (boxwidth/2) + 25, (Screen.height/2) - (boxHeight/2) +50, btnHeight, btnWidth), "Drop"))
 {
     spawnPos = Vector3(player.transform.localPosition.x, player.transform.localPosition.y, player.transform.localPosition.z + 25);
     objectToDrop = Instantiate(Resources.Load(currentItem), spawnPos,Quaternion.identity);
     objectToDrop.name.Replace("(Clone)", currentItem);
     menuItems.Remove(currentItem);
     openSubMenu = false; 
 }
 
 if(GUI.Button(Rect((Screen.width/2) - (boxwidth/2) + 100, (Screen.height/2) - (boxHeight/2) +50, btnHeight, btnWidth), "Use"))
 {
     Debug.Log("no function for this item");
 }

 if(GUI.Button(Rect((Screen.width/2) - (boxwidth/2) + 175, (Screen.height/2) - (boxHeight/2) +50, btnHeight, btnWidth), "Back"))
 {
     openSubMenu = false;
 }

}