DOJ's McKesson Contract for Medications Valued at $25M, Set to End August 2026
Contract Overview
Contract Amount: $25,028 ($25.0K)
Contractor: Mckesson Corporation
Awarding Agency: Department of Justice
Start Date: 2026-04-28
End Date: 2026-04-28
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Healthcare
Official Description: MCKESSON CONTRACT MEDICATIONS MEDICATIONS CONTRACT # 36W79720D0001 CURRENT PERFORMANCE PERIOD 8-10-24 TO 8-9-26 ALL TERMS AND CONDITIONS REMAIN THE SAME UNDER PARENT CONTRACT SAM VERIFIED
Place of Performance
Location: LEWISBURG, UNION County, PENNSYLVANIA, 17837
Plain-Language Summary
Department of Justice obligated $25,028.39 to MCKESSON CORPORATION for work described as: MCKESSON CONTRACT MEDICATIONS MEDICATIONS CONTRACT # 36W79720D0001 CURRENT PERFORMANCE PERIOD 8-10-24 TO 8-9-26 ALL TERMS AND CONDITIONS REMAIN THE SAME UNDER PARENT CONTRACT SAM VERIFIED Key points: 1. The contract is a delivery order under a larger parent contract, indicating a specific need within the Federal Prison System. 2. McKesson Corporation, a major player in pharmaceutical distribution, holds this contract. 3. The contract is priced using a Firm Fixed Price model, providing cost certainty. 4. The contract is set to expire in August 2026, with no indication of extension.
Value Assessment
Rating: good
The contract value of $25M over its performance period appears reasonable for pharmaceutical supplies to federal correctional facilities. Benchmarking against similar large-scale government pharmaceutical contracts would provide a more precise assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a competitive bidding process. This method is generally expected to yield fair market prices.
Taxpayer Impact: The use of full and open competition aims to ensure taxpayer funds are used efficiently for necessary medications.
Public Impact
Ensures a steady supply of medications for inmates within the Federal Prison System. Supports the operational needs of the Department of Justice's Bureau of Prisons. Provides a significant revenue stream for McKesson Corporation within the public sector.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Contract duration is fixed and nearing its end, requiring future planning for medication supply.
- Dependence on a single large contractor for essential medications.
Positive Signals
- Awarded through full and open competition.
- Firm Fixed Price contract provides cost predictability.
Sector Analysis
This contract falls within the Pharmaceutical Preparation Manufacturing sector, supplying essential medications to a government agency. Spending in this sector for government entities is substantial, driven by healthcare needs in corrections, military, and public health programs.
Small Business Impact
The data indicates the primary awardee is McKesson Corporation, a large business. There is no specific information provided regarding small business participation or subcontracting goals within this delivery order.
Oversight & Accountability
The contract is managed by the Department of Justice, Federal Prison System. Oversight would involve monitoring performance, delivery schedules, and adherence to contract terms to ensure accountability.
Related Government Programs
- Pharmaceutical Preparation Manufacturing
- Department of Justice Contracting
- Federal Prison System / Bureau of Prisons Programs
Risk Flags
- Contract nearing expiration date.
- Potential for supply chain disruptions affecting essential medications.
- Dependence on a single large contractor.
Tags
pharmaceutical-preparation-manufacturing, department-of-justice, pa, delivery-order, under-100k
Frequently Asked Questions
What is this federal contract paying for?
Department of Justice awarded $25,028.39 to MCKESSON CORPORATION. MCKESSON CONTRACT MEDICATIONS MEDICATIONS CONTRACT # 36W79720D0001 CURRENT PERFORMANCE PERIOD 8-10-24 TO 8-9-26 ALL TERMS AND CONDITIONS REMAIN THE SAME UNDER PARENT CONTRACT SAM VERIFIED
Who is the contractor on this award?
The obligated recipient is MCKESSON CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Justice (Federal Prison System / Bureau of Prisons).
What is the total obligated amount?
The obligated amount is $25,028.39.
What is the period of performance?
Start: 2026-04-28. End: 2026-04-28.
What is the historical performance of McKesson Corporation on similar government contracts, particularly regarding delivery timeliness and medication quality?
Assessing McKesson's past performance on comparable government contracts is crucial for understanding their reliability. Key metrics to review would include on-time delivery rates, instances of product shortages or recalls, and any quality control issues reported. This historical data can inform future contracting decisions and risk assessments for essential supply chains.
How does the per-unit cost of these medications compare to market rates or other government contracts for similar pharmaceutical products?
A thorough cost analysis comparing the per-unit pricing under this contract to benchmark data from other federal agencies, state contracts, or the commercial market is essential. Variations could indicate potential overpricing or significant cost savings, directly impacting the value for taxpayer dollars spent on these critical medications.
What contingency plans are in place should McKesson face supply chain disruptions or be unable to fulfill the contract requirements?
Given the critical nature of medications for the Federal Prison System, robust contingency planning is vital. This includes identifying alternative suppliers, maintaining strategic stockpiles, and having pre-negotiated emergency procurement options. Understanding these backup measures is key to ensuring continuity of care and mitigating risks associated with sole-source reliance.
Industry Classification
NAICS: Manufacturing › Pharmaceutical and Medicine Manufacturing › Pharmaceutical Preparation Manufacturing
Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6555 STATE HIGHWAY 161, IRVING, TX, 75039
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $25,028
Exercised Options: $25,028
Current Obligation: $25,028
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: 36W79720D0001
IDV Type: IDC
Timeline
Start Date: 2026-04-28
Current End Date: 2026-04-28
Potential End Date: 2026-04-28 00:00:00
Last Modified: 2026-04-09
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