VA awards $3.18M for Irradiation Apparatus, citing sole-source justification

Contract Overview

Contract Amount: $3,182,259 ($3.2M)

Contractor: Varian Medical Systems, Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-04-09

End Date: 2027-06-30

Contract Duration: 812 days

Daily Burn Rate: $3.9K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: RT LINAC 675B47008 VAMC ORLANDO, FO

Place of Performance

Location: PALO ALTO, SANTA CLARA County, CALIFORNIA, 94304

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $3.2 million to VARIAN MEDICAL SYSTEMS, INC for work described as: RT LINAC 675B47008 VAMC ORLANDO, FO Key points: 1. Contract awarded to Varian Medical Systems, Inc. for irradiation apparatus. 2. The contract is a delivery order under a larger contract. 3. The contract duration is 812 days. 4. The contract type is Firm Fixed Price. 5. The award was not competed. 6. The geographic location for performance is Orlando, Florida.

Value Assessment

Rating: questionable

Benchmarking the value for this specific delivery order is challenging without knowing the parent contract's terms and pricing. However, the raw dollar amount of $3.18 million for an irradiation apparatus suggests a significant investment. Without competitive bidding, it's difficult to ascertain if this represents a fair market price or if taxpayers received the best possible value. Further analysis would require comparing the unit cost and overall price to similar procurements for comparable equipment, especially if obtained through competitive means.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Varian Medical Systems, Inc., was solicited. The justification for a sole-source award typically involves unique capabilities or proprietary technology that only one source can provide. Without a competitive process, there is no direct comparison of bids to assess price discovery. The lack of competition raises questions about whether alternative, potentially more cost-effective solutions were overlooked.

Taxpayer Impact: Sole-source awards limit the government's ability to leverage competition to drive down prices, potentially leading to higher costs for taxpayers compared to a fully competed procurement.

Public Impact

Veterans receiving medical treatment at the VAMC Orlando will benefit from the advanced medical equipment. The contract ensures the availability of critical irradiation apparatus for cancer treatment and other medical procedures. The services delivered are essential for maintaining and upgrading medical technology at a key VA facility. The geographic impact is focused on the Orlando, Florida area, serving veterans in that region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher prices.
Sole-source justification needs thorough vetting to ensure necessity.
Performance risks associated with a single supplier need careful management.

Positive Signals

Award to a known entity (Varian Medical Systems) may indicate reliability.
Firm Fixed Price contract provides cost certainty for the government.
Delivery order structure suggests it's part of a larger, potentially established framework.

Sector Analysis

The procurement falls within the Healthcare sector, specifically concerning medical equipment for radiation therapy. The market for such specialized apparatus is often dominated by a few key manufacturers due to high research and development costs and stringent regulatory requirements. Varian Medical Systems is a recognized leader in this field. Comparable spending benchmarks would involve analyzing other VA or large hospital system procurements for similar irradiation devices, ideally those that were competitively bid to establish a market price.

Small Business Impact

This contract does not appear to have a small business set-aside. Given the specialized nature of irradiation apparatus, it is unlikely that small businesses would be primary manufacturers or suppliers for this specific equipment. Subcontracting opportunities for small businesses are not explicitly detailed in the provided data but would depend on Varian Medical Systems' procurement practices.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs' contracting and program management offices. Accountability measures would be tied to the delivery order's performance requirements and the terms of the parent contract. Transparency is facilitated through contract databases, though the specifics of sole-source justifications require careful review by oversight bodies to ensure they are valid and that taxpayer funds are used appropriately.

Related Government Programs

VA Medical Equipment Procurement
Radiation Therapy Equipment
Medical Devices and Supplies
Federal Healthcare Contracts

Risk Flags

Sole-source award lacks competitive pricing.
Potential for higher costs due to lack of competition.
Need for robust justification for sole-source procurement.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $3.2 million to VARIAN MEDICAL SYSTEMS, INC. RT LINAC 675B47008 VAMC ORLANDO, FO

Who is the contractor on this award?

The obligated recipient is VARIAN MEDICAL SYSTEMS, INC.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $3.2 million.

What is the period of performance?

Start: 2025-04-09. End: 2027-06-30.

What is the specific justification for the sole-source award to Varian Medical Systems, Inc. for this irradiation apparatus?

The provided data indicates the contract was 'NOT COMPETED' and is a 'sole-source' award. Typically, sole-source justifications are based on factors such as the unique capabilities or proprietary nature of the product or service, the urgency of the requirement where only one source can meet it, or the lack of adequate competition. For specialized medical equipment like irradiation apparatus, a sole-source award might be justified if Varian Medical Systems holds patents, unique manufacturing processes, or if the equipment is an upgrade or replacement for existing Varian systems where interoperability is critical. The Department of Veterans Affairs would have a formal justification document detailing these reasons, which is usually subject to review by higher authorities and potentially the Government Accountability Office (GAO) if challenged.

How does the $3.18 million award compare to historical spending on similar irradiation apparatus by the VA or other federal agencies?

Direct comparison is difficult without knowing the specific model and capabilities of the irradiation apparatus procured. However, advanced medical equipment, particularly for radiation oncology, can range from hundreds of thousands to several million dollars per unit. Historical data from federal procurement databases (like USASpending.gov) could reveal similar awards. For instance, other VA facilities or agencies like the Department of Defense might have procured comparable linear accelerators or brachytherapy units. Analyzing the price per unit, contract duration, and whether those procurements were competed would provide a benchmark. A sole-source award like this one, at $3.18 million, warrants scrutiny to ensure it aligns with or is justified relative to market prices established through competitive processes for similar technologies.

What are the key performance indicators (KPIs) and risks associated with this contract for Varian Medical Systems, Inc.?

Key performance indicators for this contract would likely include timely delivery and installation of the irradiation apparatus, successful integration with existing hospital systems, and adherence to all technical specifications and quality standards. Performance would also be measured by the reliability and uptime of the equipment post-installation. Risks associated with this sole-source contract include potential price escalation if not carefully managed, dependence on a single supplier for maintenance and future upgrades, and the possibility of performance issues if Varian Medical Systems faces internal production or supply chain disruptions. The VA would mitigate these risks through stringent contract terms, performance bonds, and potentially service level agreements for maintenance.

What is the expected impact of this irradiation apparatus on patient care at the VAMC Orlando?

The acquisition of a new or upgraded irradiation apparatus is expected to significantly enhance patient care at the VAMC Orlando. This equipment is crucial for delivering advanced radiation therapy, commonly used to treat various forms of cancer. An updated or state-of-the-art apparatus can offer improved precision, reduced treatment times, and potentially fewer side effects for patients. It allows oncologists to target tumors more effectively while minimizing damage to surrounding healthy tissues. This investment signifies the VA's commitment to providing veterans with access to modern medical technologies, ensuring they receive high-quality cancer treatment comparable to leading civilian healthcare facilities.

Are there any specific technological advancements or unique features of this Varian Medical Systems irradiation apparatus that justify a sole-source procurement?

The justification for a sole-source procurement often hinges on unique technological advancements or features that are proprietary to a specific manufacturer. Varian Medical Systems is known for innovations in radiation therapy, such as advanced imaging capabilities integrated into treatment machines (e.g., TrueBeam or Ethos systems), adaptive radiotherapy software that adjusts treatments in real-time, or specific beam-forming technologies. If this particular apparatus incorporates such cutting-edge, patented technology that is not available from competitors, or if it is designed for seamless integration with existing Varian infrastructure within the VAMC Orlando, it could form the basis for a sole-source justification. The VA would need to document these specific technological advantages and demonstrate why no other vendor could meet the requirement.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Irradiation Apparatus Manufacturing

Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 36A79724Q0011

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Altair Engineering Inc.

Address: 3100 HANSEN WAY, PALO ALTO, CA, 94304

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $3,182,259

Exercised Options: $3,182,259

Current Obligation: $3,182,259

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36H79724D0005

IDV Type: IDC

Timeline