VA awards $39.4M contract for Neptune Systems service to Stryker Sales, LLC, with no competition

Contract Overview

Contract Amount: $39,360 ($39.4K)

Contractor: Stryker Sales, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-04-04

End Date: 2027-04-03

Contract Duration: 729 days

Daily Burn Rate: $54/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: NEPTUNE SYSTEMS SERVICE FOR DURHAM VAMC

Place of Performance

Location: DURHAM, ORANGE County, NORTH CAROLINA, 27705

State: North Carolina Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $39,360 to STRYKER SALES, LLC for work described as: NEPTUNE SYSTEMS SERVICE FOR DURHAM VAMC Key points: 1. The contract's value of $39.4 million over approximately two years represents a significant investment in medical equipment maintenance. 2. The lack of competition raises questions about potential overpricing and the absence of market-driven cost efficiencies. 3. The firm-fixed-price contract type shifts cost risk to the government, which is common but requires careful monitoring. 4. This award falls within the Electronic and Precision Equipment Repair and Maintenance sector, a critical area for healthcare operations. 5. The contract's duration of two years allows for sustained service but limits opportunities for re-evaluation of market alternatives.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without specific details on the Neptune Systems and the scope of services. However, a $39.4 million award for approximately two years of maintenance for specialized medical equipment suggests a substantial per-unit cost or a broad service agreement. The absence of competition means there's no direct market comparison to assess if Stryker Sales, LLC's pricing is competitive or represents fair market value. Further analysis would require understanding the specific equipment covered, the service level agreements, and the typical costs for similar maintenance contracts within the VA or other federal agencies.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a sole-source justification, meaning it was not competed. This typically occurs when only one vendor can provide the required goods or services, often due to proprietary technology, unique capabilities, or specific contractual requirements. The lack of a competitive bidding process means that multiple potential suppliers were not given the opportunity to offer their services, which can limit price discovery and potentially lead to higher costs for the government.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive pressure. Without competing the requirement, the government cannot be assured it is receiving the best possible price or value for the maintenance services provided.

Public Impact

Veterans receiving care at the Durham VAMC will benefit from the continued maintenance and operational readiness of Neptune Systems. The contract ensures the availability of critical medical equipment, supporting diagnostic and treatment capabilities. The primary geographic impact is within North Carolina, specifically serving the Durham VAMC. The contract supports specialized technical roles for maintenance and repair personnel, likely employed by Stryker Sales, LLC or its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in higher costs for taxpayers.
Sole-source award limits opportunities for market-driven innovation and cost savings.
Contract duration of two years without re-competition may not reflect current market pricing.
Transparency regarding the justification for sole-source award could be enhanced.

Positive Signals

Ensures continued availability of critical medical equipment for veteran care.
Firm-fixed-price contract provides cost certainty for the government.
Awarding to Stryker Sales, LLC leverages existing vendor relationships or expertise with Neptune Systems.

Sector Analysis

The Electronic and Precision Equipment Repair and Maintenance sector (NAICS 811210) is vital for the functioning of healthcare facilities. This contract represents a specific instance of spending within this sector, focusing on specialized medical equipment. The total federal spending in this category can be substantial, supporting the operational readiness of numerous government facilities. Benchmarking this contract's value would involve comparing it to other maintenance contracts for similar high-value medical systems across different agencies, considering factors like equipment complexity, service scope, and vendor pricing models.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'ss' (small business) flag is also false. This suggests that the primary awardee, Stryker Sales, LLC, is likely a large business. There is no explicit information provided regarding subcontracting plans for small businesses. Without specific subcontracting goals or reporting, the direct impact on the small business ecosystem for this particular contract is unclear, though large prime contracts often involve some level of subcontracting.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs (VA). As a purchase order, it is subject to standard procurement regulations and internal VA oversight mechanisms. The VA's Office of Inspector General (OIG) would have jurisdiction to investigate any potential fraud, waste, or abuse related to this award. Transparency regarding the justification for the sole-source award and the performance metrics outlined in the contract would be key indicators of effective oversight.

Related Government Programs

Medical Equipment Maintenance Contracts
Department of Veterans Affairs Procurement
Electronic and Precision Equipment Repair
Healthcare Technology Services
Sole-Source Federal Contracts

Risk Flags

Lack of Competition
Potential for Overpricing
Limited Transparency on Justification
No Historical Spending Comparison Available

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $39,360 to STRYKER SALES, LLC. NEPTUNE SYSTEMS SERVICE FOR DURHAM VAMC

Who is the contractor on this award?

The obligated recipient is STRYKER SALES, LLC.

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 $39,360.

What is the period of performance?

Start: 2025-04-04. End: 2027-04-03.

What is the specific justification provided by the VA for awarding this contract on a sole-source basis to Stryker Sales, LLC?

The provided data does not include the specific justification for the sole-source award. Typically, sole-source contracts are awarded when only one responsible source is available to satisfy the agency's needs. This could be due to proprietary technology, unique capabilities, or a lack of adequate competition. For this contract, the VA would have had to document why Stryker Sales, LLC was the only viable option for the Neptune Systems service. Without access to the contract file or justification document (e.g., a Justification and Approval or J&A), the precise reasons remain unknown. This lack of transparency is a common concern with sole-source awards, as it prevents public scrutiny of the decision-making process and potential alternatives.

How does the $39.4 million contract value compare to historical spending on Neptune Systems maintenance by the VA or other agencies?

The provided data does not contain historical spending information for Neptune Systems maintenance, making a direct comparison impossible. To assess value, one would need to research past VA contracts for similar services or contracts awarded by other federal agencies for comparable medical equipment maintenance. Factors such as the number of systems covered, the scope of services (e.g., preventative maintenance, emergency repairs, parts included), and the contract duration would be crucial for a meaningful benchmark. A significant increase or decrease in price compared to previous periods or similar contracts could indicate changes in market conditions, service scope, or potential issues with pricing.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this contract to ensure effective service delivery?

The provided data does not specify the key performance indicators (KPIs) or service level agreements (SLAs) for this contract. Effective contracts for medical equipment maintenance typically include detailed SLAs that define response times for service calls, equipment uptime guarantees, preventative maintenance schedules, and reporting requirements. KPIs are used to measure the contractor's performance against these SLAs. Without this information, it is difficult to objectively assess the quality and timeliness of the services provided by Stryker Sales, LLC. The VA would typically monitor these metrics to ensure they are meeting the contract's objectives and to hold the contractor accountable.

What is the track record of Stryker Sales, LLC in performing similar federal contracts, particularly for medical equipment maintenance?

The provided data does not include information on Stryker Sales, LLC's track record with federal contracts. A comprehensive assessment would require reviewing past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS) for this company on similar contracts. This would reveal their history of meeting deadlines, quality standards, and contractual obligations. Given that this is a sole-source award, understanding their past performance is even more critical to ensure they are capable of delivering the required services effectively and efficiently. Without this historical data, the risk associated with awarding this significant contract is harder to quantify.

What is the estimated number of Neptune Systems units covered under this contract and the implied per-unit maintenance cost?

The provided data does not specify the number of Neptune Systems units covered under this contract. The total award amount is $39.4 million over approximately 729 days (2 years). Without knowing the quantity of systems, it is impossible to calculate a precise per-unit maintenance cost. If, for example, the contract covered 100 units, the average annual cost per unit would be approximately $197,000 ($39.4M / 2 years / 100 units). If it covered 500 units, the average annual cost per unit would be around $39,400. The actual per-unit cost is a critical factor in assessing value for money, and its absence in the summary data limits detailed financial analysis.

Industry Classification

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

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 36C24625Q0350

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1941 STRYKER WAY, PORTAGE, MI, 49002

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $59,040

Exercised Options: $39,360

Current Obligation: $39,360

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline