VA awards $2.07M contract for Varian Linear Accelerator maintenance to Varian Medical Systems

Contract Overview

Contract Amount: $2,066,346 ($2.1M)

Contractor: Varian Medical Systems, Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-03-24

End Date: 2027-02-28

Contract Duration: 1,071 days

Daily Burn Rate: $1.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: VARIAN LINEAR ACCELERATOR (LINAC) AND SOFTWARE (ARIA/ECLIPSE) MAINTENANCE AND SUPPORT.

Place of Performance

Location: HINES, COOK County, ILLINOIS, 60141

State: Illinois Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $2.1 million to VARIAN MEDICAL SYSTEMS, INC for work described as: VARIAN LINEAR ACCELERATOR (LINAC) AND SOFTWARE (ARIA/ECLIPSE) MAINTENANCE AND SUPPORT. Key points: 1. The contract focuses on essential maintenance and support for critical medical equipment. 2. Varian Medical Systems is the sole provider, indicating a lack of competition. 3. The fixed-price contract structure aims to control costs for this specialized service. 4. This spending falls within the Electronic and Precision Equipment Repair and Maintenance sector.

Value Assessment

Rating: fair

The contract value of $2.07M over approximately three years for specialized medical equipment maintenance appears reasonable given the sole-source nature. Benchmarking is difficult without competitive data.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, likely due to the proprietary nature of Varian's linear accelerator and software systems. This limits price discovery and potentially leads to higher costs.

Taxpayer Impact: Taxpayers may be paying a premium due to the lack of competitive bidding for this essential medical equipment maintenance.

Public Impact

Ensures continued operation of vital cancer treatment equipment for veterans. Potential for higher costs due to sole-source award impacts budget allocation. Reliability of equipment is critical for patient care and treatment continuity.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition
Potential for inflated pricing without competitive bidding

Positive Signals

Essential service for critical medical equipment
Fixed-price contract provides cost certainty

Sector Analysis

Spending in the Electronic and Precision Equipment Repair and Maintenance sector, particularly for specialized medical devices like linear accelerators, is crucial for healthcare delivery. Benchmarks are difficult to establish for sole-source contracts of this nature.

Small Business Impact

This contract was awarded directly to Varian Medical Systems, Inc., and there is no indication of subcontracting opportunities for small businesses. The specialized nature of the equipment likely restricts small business involvement.

Oversight & Accountability

The Department of Veterans Affairs is responsible for overseeing this contract. The fixed-price nature provides some cost control, but the sole-source award warrants scrutiny to ensure fair pricing.

Related Government Programs

Electronic and Precision Equipment Repair and Maintenance
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Sole-source award
Lack of competitive bidding
Potential for higher costs
Reliance on a single vendor

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $2.1 million to VARIAN MEDICAL SYSTEMS, INC. VARIAN LINEAR ACCELERATOR (LINAC) AND SOFTWARE (ARIA/ECLIPSE) MAINTENANCE AND SUPPORT.

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 $2.1 million.

What is the period of performance?

Start: 2024-03-24. End: 2027-02-28.

What is the justification for the sole-source award, and has the VA explored alternative maintenance solutions or partnerships?

The justification for a sole-source award typically rests on the unique capabilities or proprietary nature of the product or service. For Varian's linear accelerators and ARIA/Eclipse software, it's common for the original manufacturer to be the only entity capable of providing specialized maintenance and support. The VA should have documented this justification, and while direct competition might be infeasible, exploring options like performance-based contracts or multi-year agreements with the sole provider could offer better value.

How does the per-unit cost of this maintenance contract compare to similar contracts for comparable linear accelerator systems, if available?

Direct per-unit cost comparisons are challenging without access to similar sole-source contracts or competitive bids for comparable Varian systems. However, the VA should have internal benchmarks or industry data to assess if the $2.07 million over approximately three years is within an acceptable range for this type of specialized, high-value medical equipment. The absence of competition inherently makes price validation more difficult.

What are the potential risks to patient care if this maintenance contract is not effectively managed or if Varian faces disruptions?

Disruptions in maintenance for linear accelerators pose significant risks to patient care, potentially leading to treatment delays or cancellations for cancer patients. Equipment downtime directly impacts the VA's ability to provide timely and effective radiation therapy. Effective contract management by the VA is crucial to ensure Varian meets service level agreements and minimizes any potential impact on veteran healthcare services.

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: 36C25224Q0187

Offers Received: 1

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: $3,575,726

Exercised Options: $2,066,346

Current Obligation: $2,066,346

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline