VA awards $306K for Monarch platform maintenance, a sole-source contract for bronchoscopy equipment

Contract Overview

Contract Amount: $306,000 ($306.0K)

Contractor: Auris Health, Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2021-09-01

End Date: 2025-11-30

Contract Duration: 1,551 days

Daily Burn Rate: $197/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: PREVENTIVE & CORRECTIVE MAINTENANCE - VA OWNED MONARCH PLATFORM FOR BRONCHOSCOPY - VAPHS

Place of Performance

Location: WILMINGTON, NEW CASTLE County, DELAWARE, 19805

State: Delaware Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $306,000 to AURIS HEALTH, INC for work described as: PREVENTIVE & CORRECTIVE MAINTENANCE - VA OWNED MONARCH PLATFORM FOR BRONCHOSCOPY - VAPHS Key points: 1. The contract value of $306,000 over its period of performance suggests a moderate investment in specialized equipment maintenance. 2. As a sole-source award, there is a lack of competitive pressure, potentially impacting price efficiency. 3. The fixed-price nature of the contract provides cost certainty for the government, but limits flexibility for scope changes. 4. The duration of the contract (over 4 years) indicates a long-term need for the maintenance services. 5. The specific nature of the Monarch platform suggests a niche requirement within the VA's medical equipment portfolio. 6. The absence of small business set-aside flags this as a contract not specifically aimed at boosting small business participation.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without comparable sole-source maintenance agreements for specialized medical equipment. The total award of $306,000 over approximately 51 months averages to about $6,000 per month. This figure needs to be assessed against the complexity and criticality of the Monarch platform. Given it's a sole-source award, a direct comparison to market rates for similar services is difficult, and the value proposition relies heavily on the unique capabilities of the equipment and the necessity of specialized maintenance.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Auris Health, Inc., was solicited. This approach is typically used when a product or service is unique and only available from a single source, or in cases of urgent need. The lack of competition means that the VA did not benefit from a bidding process that could have potentially driven down prices or offered alternative solutions. The justification for sole-sourcing would need to be robust to ensure fair pricing and necessity.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as there is no competitive pressure to ensure the lowest possible price. This can also limit the government's ability to explore potentially more cost-effective solutions from other vendors.

Public Impact

Veterans undergoing bronchoscopy procedures will benefit from the reliable functioning of the Monarch platform, ensuring access to advanced diagnostic and therapeutic interventions. The contract ensures the continued availability and operational readiness of critical medical equipment within VA facilities. The geographic impact is localized to the VA facilities where the Monarch platform is deployed and maintained. Specialized technicians employed by Auris Health, Inc. will be involved in the maintenance, potentially impacting the local workforce in areas where the VA facilities are located.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Sole-source nature limits exploration of alternative, potentially more cost-effective maintenance solutions.
Dependence on a single vendor for critical equipment maintenance poses a supply chain risk.

Positive Signals

Ensures continued operation of specialized medical equipment vital for patient care.
Fixed-price contract provides budget certainty for the VA.
Direct award to the original equipment manufacturer likely ensures specialized knowledge and timely support.

Sector Analysis

The healthcare technology sector is characterized by rapid innovation and specialized equipment. Maintenance contracts for advanced medical devices like the Monarch platform are crucial for ensuring their longevity and effective use. Spending in this area is often driven by the need for specialized expertise that only the original equipment manufacturer or authorized service providers can offer. Benchmarks for such specialized maintenance are difficult to establish due to the unique nature of the technology and the limited number of qualified service providers.

Small Business Impact

This contract does not appear to have a small business set-aside. As a sole-source award to Auris Health, Inc., it is unlikely that subcontracting opportunities for small businesses will be a significant component, unless Auris Health voluntarily engages small businesses for specific support services not directly related to the core maintenance of the Monarch platform.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs' contracting officers and program managers. Accountability is maintained through the terms and conditions of the purchase order, including performance standards and payment schedules. Transparency is limited due to the sole-source nature, with details of the justification for this award not publicly detailed in the provided data. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Medical Equipment Maintenance
Bronchoscopy Services
Veterans Health Administration
Medical Technology Procurement

Risk Flags

Sole-source award lacks competitive pricing.
Potential for vendor lock-in with specialized equipment.
Limited transparency on contract justification and performance metrics.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $306,000 to AURIS HEALTH, INC. PREVENTIVE & CORRECTIVE MAINTENANCE - VA OWNED MONARCH PLATFORM FOR BRONCHOSCOPY - VAPHS

Who is the contractor on this award?

The obligated recipient is AURIS HEALTH, 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 $306,000.

What is the period of performance?

Start: 2021-09-01. End: 2025-11-30.

What is the specific justification for awarding this contract on a sole-source basis to Auris Health, Inc.?

The provided data indicates the contract was 'NOT COMPETED UNDER SAP' and is a sole-source award. Typically, sole-source contracts are justified when the product or service is unique and only available from a single responsible source, or in cases of urgent and compelling need. For specialized medical equipment like the Monarch platform, this often stems from proprietary technology, unique maintenance requirements, or the need for manufacturer-specific expertise to ensure proper functioning and patient safety. A detailed justification would normally be documented by the agency, outlining why competition was not feasible or practicable, and why Auris Health, Inc. is the only capable provider.

How does the annual maintenance cost compare to similar specialized medical equipment contracts within the VA or other federal agencies?

Direct comparison is challenging due to the specialized nature of the Monarch platform and the sole-source award. The total contract value is $306,000 over approximately 51 months (from September 1, 2021, to November 30, 2025). This averages to roughly $72,000 per year, or about $6,000 per month. Without knowing the specific maintenance tasks, frequency, and criticality of the Monarch system, it's difficult to benchmark against other medical equipment. However, maintenance for advanced diagnostic and therapeutic systems can be substantial, often representing a significant portion of the total cost of ownership. The lack of competition means this figure cannot be directly validated against market alternatives.

What are the key performance indicators (KPIs) or service level agreements (SLAs) associated with this maintenance contract?

The provided data does not specify the key performance indicators (KPIs) or service level agreements (SLAs) for this contract. However, for critical medical equipment maintenance, typical SLAs would likely include response times for service calls, equipment uptime guarantees, preventive maintenance schedules, and quality standards for repairs. The purchase order would detail these requirements, and the VA would monitor Auris Health, Inc.'s performance against them to ensure the Monarch platform remains operational and safe for patient use. Failure to meet these SLAs could result in penalties or contract termination.

What is the historical spending pattern for maintenance of the Monarch platform or similar bronchoscopy equipment by the VA?

The provided data only pertains to this specific contract awarded in 2021. Historical spending patterns for the Monarch platform's maintenance by the VA are not detailed here. However, given that this is a sole-source award for a specific piece of equipment, it suggests a continuous need for maintenance since its acquisition. To understand historical spending, one would need to examine previous contracts for this equipment, if any, or similar bronchoscopy systems, and analyze spending trends over multiple fiscal years. This contract's duration implies a commitment to ongoing support for this technology.

Are there any identified risks associated with relying on a single vendor for the maintenance of this critical medical technology?

Yes, there are inherent risks associated with relying on a single vendor for critical medical technology maintenance. These include: 1) Price escalation over time, as the vendor faces no competitive pressure. 2) Potential for service disruptions if the vendor experiences financial difficulties, operational issues, or decides to discontinue support for the product line. 3) Limited leverage for the VA in negotiating terms or service levels. 4) Dependence on the vendor's expertise, which might not be available elsewhere. To mitigate these risks, the VA would typically ensure strong contract terms, performance monitoring, and potentially explore options for technology transfer or alternative support solutions in the long term.

Industry Classification

NAICS: Other Services (except Public Administration) › Electronic and Precision Equipment Repair and Maintenance › Other Electronic and Precision Equipment Repair and Maintenance

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Johnson & Johnson

Address: 150 SHORELINE DR, REDWOOD CITY, CA, 94065

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $306,000

Exercised Options: $306,000

Current Obligation: $306,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline