VA awards $31.5M for medical instruments, with SDV Office Systems LLC as the contractor

Contract Overview

Contract Amount: $31,503,040 ($31.5M)

Contractor: SDV Office Systems LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-09-19

End Date: 2025-12-14

Contract Duration: 86 days

Daily Burn Rate: $366.3K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: DA VINCI DV5, BULK PURCHASE VISN 8

Place of Performance

Location: FLETCHER, HENDERSON County, NORTH CAROLINA, 28732

State: North Carolina Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $31.5 million to SDV OFFICE SYSTEMS LLC for work described as: DA VINCI DV5, BULK PURCHASE VISN 8 Key points: 1. The contract value of $31.5 million represents a significant investment in medical instruments for VISN 8. 2. The procurement was conducted under full and open competition, suggesting a robust market for these supplies. 3. The fixed-price contract type aims to control costs and provide budget certainty for the VA. 4. The short performance period (approximately 3 months) indicates a need for immediate or time-sensitive supply. 5. The North American Industry Classification System (NAICS) code 339112 points to a specialized manufacturing sector. 6. The award to SDV Office Systems LLC highlights a specific supplier's capability in meeting VA's instrument needs.

Value Assessment

Rating: good

The award of $31.5 million for medical instruments appears to be a substantial but potentially reasonable amount given the scope of supplying a Veterans Integrated Service Network (VISN). Without specific details on the exact instruments and quantities, a direct comparison is challenging. However, the firm-fixed-price nature of the contract suggests that the contractor, SDV Office Systems LLC, has committed to delivering the specified goods at a set price, which is generally favorable for the government in managing costs. Benchmarking against similar large-scale medical instrument procurements would provide further insight into the value proposition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that the Department of Veterans Affairs solicited bids from all responsible sources. The fact that it was competed openly suggests that multiple vendors were likely interested and capable of fulfilling the requirement. This level of competition is generally expected to drive competitive pricing and ensure the government receives fair market value for the goods and services procured. The specific number of bidders is not provided, but the method itself is a positive indicator for price discovery.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to lower prices and better quality goods. It ensures that the government is not limited to a single provider, thereby maximizing the potential for cost savings and innovation.

Public Impact

Veterans receiving care within VISN 8 will benefit from the availability of necessary surgical and medical instruments. The contract ensures the supply chain for critical medical equipment remains robust for VA healthcare facilities. The geographic impact is concentrated within the regions served by VISN 8, which spans multiple states in the southeastern U.S. The contract supports jobs within the medical instrument manufacturing sector, potentially including those at SDV Office Systems LLC and its suppliers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The short performance period could indicate a potential for urgent needs or a gap in existing supply chains that requires rapid fulfillment.
The reliance on a single award for a significant dollar amount warrants monitoring to ensure continued supply and prevent potential disruptions.
Without detailed specifications, it's difficult to assess if the awarded instruments fully meet the evolving clinical needs of VISN 8.

Positive Signals

The use of full and open competition suggests a well-defined requirement and a healthy market response.
The firm-fixed-price contract type provides cost certainty and shifts risk to the contractor.
The award to SDV Office Systems LLC, if they are a capable provider, ensures a dedicated supplier for these critical instruments.

Sector Analysis

The medical instrument manufacturing sector (NAICS 339112) is a critical component of the healthcare industry, encompassing the production of a wide range of devices used in diagnosis, treatment, and surgery. This sector is characterized by innovation, stringent regulatory requirements, and significant government procurement, particularly from agencies like the Department of Veterans Affairs. The market size is substantial, driven by an aging population and advancements in medical technology. This contract fits within the broader category of medical supply procurement, where the VA is a major customer seeking to equip its facilities with state-of-the-art and essential instruments.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'st': 'NC' and 'sn': 'NORTH CAROLINA' likely refer to the state of the contractor or a performance location, not a small business designation. The primary contractor, SDV Office Systems LLC, is not flagged as a small business for this award. There is no explicit information regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem through this specific award is likely minimal, unless SDV Office Systems LLC voluntarily engages small businesses in its supply chain.

Oversight & Accountability

The Department of Veterans Affairs has established oversight mechanisms for its contracts, including this one. The firm-fixed-price nature of the contract provides a degree of financial oversight by setting a definitive cost. Accountability is expected through the delivery of specified instruments by the performance end date. Transparency is facilitated by the public nature of contract awards, allowing for analysis. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to this contract.

Related Government Programs

Department of Veterans Affairs Medical Equipment Procurement
Surgical Instrument Supply Contracts
VISN 8 Healthcare Services
Federal Supply Schedule (FSS) Contracts for Medical Supplies

Risk Flags

Potential for supply chain disruption
Quality control of medical instruments
Short performance period may indicate urgent need
Contractor performance history unknown

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $31.5 million to SDV OFFICE SYSTEMS LLC. DA VINCI DV5, BULK PURCHASE VISN 8

Who is the contractor on this award?

The obligated recipient is SDV OFFICE SYSTEMS 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 $31.5 million.

What is the period of performance?

Start: 2025-09-19. End: 2025-12-14.

What is the track record of SDV Office Systems LLC in fulfilling federal contracts, particularly for the Department of Veterans Affairs?

A thorough review of SDV Office Systems LLC's federal contract history would be necessary to assess their track record. This would involve examining past performance on similar contracts, including on-time delivery, quality of goods, and adherence to contract terms. Specifically for the Department of Veterans Affairs, understanding their experience with VA procurements, including any challenges or successes, would provide crucial context. Data from contract databases like SAM.gov or FPDS would be essential for this analysis, looking for patterns in contract awards, values, and performance ratings. Without this specific data, it is difficult to definitively assess their reliability for this $31.5 million award.

How does the awarded price of $31.5 million compare to market rates for similar bulk purchases of surgical and medical instruments?

To benchmark the $31.5 million award, one would need to compare it against the prices of similar bulk purchases of surgical and medical instruments in the open market or through other federal contracts. This comparison should consider the specific types and quantities of instruments included in the VA's requirement, as well as the quality and brand specifications. Analyzing historical contract data for the VA or other federal agencies procuring comparable items can provide a baseline. Factors such as volume discounts, delivery terms, and any included services (like installation or maintenance) would need to be standardized for a fair comparison. If the VA's price is significantly higher or lower than comparable market rates, it could indicate either exceptional value or potential issues with pricing.

What are the primary risks associated with this contract, and how are they being mitigated?

Primary risks for this contract include potential supply chain disruptions affecting SDV Office Systems LLC, quality control issues with the instruments, and the possibility of the awarded instruments becoming obsolete or insufficient for evolving medical needs within the short performance period. Mitigation strategies are likely embedded in the contract terms. The firm-fixed-price structure shifts financial risk to the contractor. Performance clauses and quality assurance provisions would allow the VA to hold the contractor accountable for delivering conforming goods. The short duration might mitigate obsolescence risk but could increase the risk of urgent need fulfillment challenges. The VA's oversight and potential for contract modifications or termination for default also serve as risk mitigation tools.

How effective is the firm-fixed-price contract type in ensuring value for money for this specific medical instrument procurement?

The firm-fixed-price (FFP) contract type is generally considered effective in ensuring value for money when the scope of work is well-defined and the risks of cost overruns are manageable. For a bulk purchase of medical instruments, where specifications are likely clear, FFP provides cost certainty for the VA and incentivizes the contractor, SDV Office Systems LLC, to manage its own costs efficiently to maximize profit. This reduces the government's exposure to unforeseen cost increases. The value for money is realized if the price negotiated under FFP reflects competitive market conditions and the quality of instruments meets or exceeds expectations. The primary risk with FFP is that if the contractor underestimates costs, they may cut corners on quality, which requires robust government oversight.

What are the historical spending patterns of the Department of Veterans Affairs on surgical and medical instruments, and how does this award fit within that trend?

Analyzing the VA's historical spending on surgical and medical instruments would reveal trends in procurement volume, average contract values, and key suppliers. This $31.5 million award needs to be viewed in that context. If the VA typically awards contracts in this range for similar needs, then this award is consistent with past patterns. If it represents a significant increase or decrease, further investigation into the reasons (e.g., increased demand, new technology, consolidation of contracts) would be warranted. Understanding the historical distribution of spending across different types of instruments and across various VISNs would also help contextualize this specific award to VISN 8.

Industry Classification

NAICS: Manufacturing › Medical Equipment and Supplies Manufacturing › Surgical and Medical Instrument 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: 34 REDMOND DR UNIT C, FLETCHER, NC, 28732

Business Categories: Category Business, DoT Certified Disadvantaged Business Enterprise, Limited Liability Corporation, Partnership or Limited Liability Partnership, Self-Certified Small Disadvantaged Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $31,503,040

Exercised Options: $31,503,040

Current Obligation: $31,503,040

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C10G25D0013

IDV Type: IDC

Timeline