VA awards $5.47M contract for analytical instruments, highlighting a competitive procurement process

Contract Overview

Contract Amount: $5,471,876 ($5.5M)

Contractor: Roche Diagnostics Corporation

Awarding Agency: Department of Veterans Affairs

Start Date: 2020-06-01

End Date: 2025-03-31

Contract Duration: 1,764 days

Daily Burn Rate: $3.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: CPT

Place of Performance

Location: INDIANAPOLIS, MARION County, INDIANA, 46256

State: Indiana Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $5.5 million to ROCHE DIAGNOSTICS CORPORATION for work described as: CPT Key points: 1. The contract value of $5.47 million over its period of performance suggests a significant investment in laboratory instrumentation. 2. The use of 'FULL AND OPEN COMPETITION' indicates a robust bidding process, likely leading to competitive pricing. 3. The contract's duration of 1764 days (approximately 4.8 years) suggests a long-term need for these analytical instruments. 4. The 'FIRM FIXED PRICE' contract type provides cost certainty for the government, shifting performance risk to the contractor. 5. The award to ROCHE DIAGNOSTICS CORPORATION positions them as a key supplier for the VA's analytical needs. 6. The North American Industry Classification System (NAICS) code 334516 points to the manufacturing of analytical laboratory instruments.

Value Assessment

Rating: good

Benchmarking the $5.47 million contract value against similar procurements for analytical laboratory instruments is challenging without specific details on the instruments' capabilities and quantities. However, the firm fixed-price structure suggests the government sought predictable costs. The competitive nature of the award implies that pricing was likely evaluated against market rates and other proposals, aiming for value for money. Further analysis would require comparing the specific instrument models and their features to commercially available options and other government contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, meaning all responsible sources were permitted to submit a bid. The data indicates there were 2 bids received. A competitive process with multiple bidders generally fosters price discovery and encourages contractors to offer their best pricing and terms to win the award. The presence of two bidders suggests a degree of market interest, though a higher number of bidders could potentially drive prices even lower.

Taxpayer Impact: A full and open competition ensures that taxpayer dollars are used efficiently by allowing the government to select the most advantageous offer, typically balancing price and performance. This approach maximizes the potential for cost savings compared to sole-source or limited competitions.

Public Impact

Veterans will benefit from improved diagnostic capabilities through the use of advanced analytical laboratory instruments. The contract supports the delivery of essential laboratory services within the Department of Veterans Affairs. The geographic impact is primarily within Indiana, where the contract is stated to be 'IN' (Indiana). The contract supports the manufacturing sector for analytical laboratory instruments, potentially impacting the workforce involved in production and support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if instruments require proprietary consumables or maintenance from the awardee.
Dependence on a single awardee for critical laboratory equipment could pose supply chain risks.
The limited number of bidders (2) might indicate a concentrated market or high barriers to entry for competitors.

Positive Signals

The 'FULL AND OPEN COMPETITION' signals a commitment to leveraging market forces for best value.
The 'FIRM FIXED PRICE' contract type provides budget certainty and transfers risk to the contractor.
The award to a known entity like ROCHE DIAGNOSTICS CORPORATION suggests a level of established quality and reliability.

Sector Analysis

The market for analytical laboratory instruments is a significant segment within the broader healthcare and scientific equipment industry. This sector is characterized by technological innovation, high research and development costs, and stringent regulatory requirements. Companies like Roche Diagnostics operate in a competitive landscape, offering a range of instruments for various diagnostic and research purposes. Government procurements, particularly from agencies like the VA, represent a substantial portion of this market, driving demand for advanced medical technology.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). While this contract was not directly set aside for small businesses, the prime contractor, ROCHE DIAGNOSTICS CORPORATION, may engage small businesses as subcontractors. The extent of small business subcontracting is not detailed in this award notice. The impact on the small business ecosystem would depend on whether Roche Diagnostics actively seeks out and utilizes small business suppliers for components, services, or support related to these instruments.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs' contracting and program management offices. Accountability measures are embedded in the firm fixed-price contract terms, requiring the contractor to deliver specified instruments and services by the end date. Transparency is facilitated by the public nature of contract awards, allowing for review of basic terms. Inspector General jurisdiction would apply if any fraud, waste, or abuse related to the contract were suspected or identified.

Related Government Programs

Medical Equipment Procurement
Laboratory Services
Diagnostic Instruments
Veterans Health Administration Contracts

Risk Flags

Limited Competition
Potential for Vendor Lock-in
Supply Chain Dependence

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $5.5 million to ROCHE DIAGNOSTICS CORPORATION. CPT

Who is the contractor on this award?

The obligated recipient is ROCHE DIAGNOSTICS CORPORATION.

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 $5.5 million.

What is the period of performance?

Start: 2020-06-01. End: 2025-03-31.

What specific types of analytical laboratory instruments are covered under this contract, and what are their primary functions for the VA?

The contract, identified by NAICS code 334516 (Analytical Laboratory Instrument Manufacturing), pertains to the procurement of analytical laboratory instruments. While the specific models and their detailed functionalities are not provided in the summary data, these instruments are typically used for quantitative and qualitative analysis of biological, chemical, or physical samples. For the VA, such instruments are crucial for clinical diagnostics, disease monitoring, and research, enabling healthcare providers to make informed treatment decisions for veterans. Examples could include automated blood analyzers, immunoassay platforms, or molecular diagnostic systems, all contributing to a comprehensive healthcare delivery system.

How does the $5.47 million contract value compare to historical spending by the VA on similar analytical instruments?

To accurately compare the $5.47 million contract value to historical VA spending, a detailed analysis of past procurements for comparable analytical laboratory instruments would be necessary. This would involve identifying contracts with similar NAICS codes, instrument types, and performance periods. Without access to a comprehensive database of historical VA contracts and specific instrument specifications, a direct benchmark is difficult. However, the value suggests a significant, multi-year investment, potentially for a large number of instruments or high-complexity systems, reflecting the VA's ongoing commitment to maintaining advanced diagnostic capabilities across its facilities.

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

The provided summary data does not explicitly detail the Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. However, as a 'FIRM FIXED PRICE' contract, the primary performance expectation is the successful delivery of the specified analytical laboratory instruments by the end date (March 31, 2025). Additional implicit performance expectations likely include the instruments meeting defined technical specifications, operational readiness, and potentially warranty or maintenance provisions. The 'FULL AND OPEN COMPETITION' suggests that the terms of performance, including any SLAs, were part of the evaluation criteria used to select the winning proposal from Roche Diagnostics Corporation.

What is Roche Diagnostics Corporation's track record with the VA and other federal agencies for similar procurements?

Roche Diagnostics Corporation is a well-established global leader in in-vitro diagnostics, and it is highly probable they have a significant track record with the Department of Veterans Affairs and other federal agencies. Their extensive portfolio of analytical instruments and diagnostic solutions suggests frequent engagement in government contracting. To assess their specific track record for this type of procurement, one would typically review past contract awards, performance evaluations (if publicly available), and any reported issues or successes. Their established presence in the market implies a history of fulfilling government requirements, though the specifics of past performance on similar analytical instrument contracts would require deeper database research.

Given the 'FULL AND OPEN COMPETITION' with 2 bidders, what does this imply about the market concentration for these types of analytical instruments?

A 'FULL AND OPEN COMPETITION' with only two bidders suggests a potentially concentrated market for the specific types of analytical laboratory instruments covered by this contract. This could indicate that the market is dominated by a few large players, or that the technical specifications and requirements of the solicitation were highly specialized, limiting the number of capable respondents. While two bidders still represent competition, a less concentrated market might typically yield more proposals, potentially driving prices down further. It raises questions about barriers to entry for other potential suppliers and the overall competitive landscape within this niche of the analytical instrument sector.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Analytical Laboratory Instrument Manufacturing

Product/Service Code: INSTRUMENTS AND LABORATORY EQPT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Roche Holding AG

Address: 9115 HAGUE RD, INDIANAPOLIS, IN, 46256

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

Financial Breakdown

Contract Ceiling: $5,471,876

Exercised Options: $5,471,876

Current Obligation: $5,471,876

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: V797P7347A

IDV Type: FSS

Timeline