VA awards $4.8M for Abbot Optis M preventative maintenance, a sole-source contract

Contract Overview

Contract Amount: $48,020 ($48.0K)

Contractor: Abbott Laboratories Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-07-02

End Date: 2027-07-01

Contract Duration: 729 days

Daily Burn Rate: $66/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: PREVENTATIVE MAINTENANCE FOR ABBOT OPTIS M

Place of Performance

Location: LOMA LINDA, SAN BERNARDINO County, CALIFORNIA, 92357

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $48,020 to ABBOTT LABORATORIES INC. for work described as: PREVENTATIVE MAINTENANCE FOR ABBOT OPTIS M Key points: 1. Contract awarded on a sole-source basis, limiting competitive pricing opportunities. 2. The duration of the contract is 729 days, indicating a medium-term commitment. 3. The contract is a Purchase Order, typically used for simpler acquisitions. 4. The North American Industry Classification System (NAICS) code is 811210 for Electronic and Precision Equipment Repair and Maintenance. 5. The contract is firm-fixed-price, providing cost certainty for the government. 6. The vendor, Abbott Laboratories Inc., is the likely original equipment manufacturer, suggesting specialized knowledge is required.

Value Assessment

Rating: fair

Benchmarking the value of this preventative maintenance contract is challenging without comparable sole-source agreements for the Abbot Optis M system. The fixed-price nature provides cost certainty, but the lack of competition may have led to a higher price than a competed contract. The total award amount of $4.8 million over two years suggests a significant investment in maintaining this specific medical equipment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Abbott Laboratories Inc., was solicited. This typically occurs when the supplies or services are available only from a single source, often due to proprietary technology or specialized expertise. The lack of competition means that price discovery through market forces was not utilized, potentially impacting the final cost to the government.

Taxpayer Impact: Sole-source awards can result in higher costs for taxpayers as competitive pressures that drive down prices are absent. This necessitates strong justification for the sole-source determination to ensure fair value is obtained.

Public Impact

Veterans receiving care at VA facilities will benefit from the reliable functioning of Abbot Optis M equipment. Ensures the continued availability of diagnostic and treatment capabilities reliant on this specific medical device. The contract supports the operational readiness of medical equipment within the Department of Veterans Affairs. Indirectly supports healthcare professionals who rely on this equipment for patient care.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Sole-source award requires strong justification to ensure taxpayer value.
Reliance on a single vendor for critical maintenance could pose supply chain risks if the vendor faces issues.

Positive Signals

Firm-fixed-price contract provides budget certainty.
Award to the original equipment manufacturer likely ensures specialized expertise for maintenance.
Contract duration aligns with expected equipment lifecycle needs for preventative care.

Sector Analysis

The healthcare equipment maintenance sector is critical for ensuring the operational readiness of medical facilities. This contract falls under the broader category of electronic and precision equipment repair and maintenance. Spending in this area is driven by the need to keep sophisticated medical devices, such as the Abbot Optis M, functioning optimally to provide patient care. Comparable spending benchmarks would involve analyzing maintenance contracts for similar high-value medical diagnostic equipment across federal healthcare providers.

Small Business Impact

This contract does not appear to have a small business set-aside. As a sole-source award to Abbott Laboratories Inc., a large corporation, there are no direct subcontracting opportunities for small businesses specified within this award. The focus is on specialized maintenance provided by the original equipment manufacturer.

Oversight & Accountability

Oversight for this contract will be managed by the Department of Veterans Affairs. As a Purchase Order, it falls under standard procurement regulations and agency oversight. Transparency is generally maintained through contract databases, though the specifics of the sole-source justification and pricing negotiations would be internal to the VA. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Medical Equipment Maintenance Contracts
Department of Veterans Affairs Procurement
Sole-Source Healthcare Contracts
Preventative Maintenance Services

Risk Flags

Sole-source award
Potential for overpricing
Lack of competitive bidding

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $48,020 to ABBOTT LABORATORIES INC.. PREVENTATIVE MAINTENANCE FOR ABBOT OPTIS M

Who is the contractor on this award?

The obligated recipient is ABBOTT LABORATORIES 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 $48,020.

What is the period of performance?

Start: 2025-07-02. End: 2027-07-01.

What is the historical spending by the VA on preventative maintenance for Abbot Optis M systems?

Historical spending data for preventative maintenance specifically on Abbot Optis M systems by the Department of Veterans Affairs is not readily available in public databases. However, the current award of $4.8 million over approximately two years (729 days) provides a benchmark for future or past similar needs. To ascertain historical patterns, one would need to access internal VA procurement records or conduct a more in-depth analysis of contract vehicles that might encompass this equipment under broader service agreements. Without specific historical data, it's difficult to determine if this $4.8 million represents an increase, decrease, or consistent level of spending for this particular service.

How does the per-unit cost of this maintenance contract compare to industry benchmarks for similar equipment?

Determining a precise per-unit cost for this contract is challenging as the $4.8 million award is for a blanket preventative maintenance service over 729 days, not necessarily tied to a specific number of units or service calls. The Abbot Optis M is a specialized piece of medical equipment, and its maintenance costs are likely influenced by proprietary technology and the need for manufacturer-certified technicians. Without knowing the exact number of Abbot Optis M systems covered under this contract and the scope of 'preventative maintenance' (e.g., scheduled checks, software updates, minor part replacements), a direct comparison to industry benchmarks is difficult. Generally, sole-source maintenance contracts for specialized medical equipment tend to be higher than if the service were competed among multiple qualified vendors.

What are the specific risks associated with a sole-source award for critical medical equipment maintenance?

The primary risk of a sole-source award for critical medical equipment maintenance is the potential for inflated pricing due to the absence of competitive bidding. Taxpayers may end up paying more than necessary. Another significant risk is vendor lock-in; the government becomes dependent on a single provider, which can limit flexibility and bargaining power in the future. If the sole-source provider experiences financial difficulties, operational disruptions, or decides to discontinue the service, it could severely impact the availability of maintenance for critical equipment, potentially leading to downtime and affecting patient care. Furthermore, without competition, there's less incentive for the vendor to innovate or improve service quality beyond the contract minimums.

What is Abbott Laboratories Inc.'s track record with the VA for similar maintenance contracts?

Abbott Laboratories Inc. has a history of contracts with the Department of Veterans Affairs, including those related to medical equipment and supplies. While specific details on their track record for preventative maintenance of Abbot Optis M systems are not exhaustively detailed in public summaries, their status as a major medical device manufacturer suggests they are a primary provider for their own equipment's upkeep. Analyzing past VA contract awards to Abbott Laboratories Inc. would reveal their performance history, on-time delivery rates, and any documented issues or commendations related to service contracts. A review of contract databases would be necessary to quantify the value and scope of their previous engagements with the VA.

How does the duration of this contract (729 days) align with the typical lifecycle or maintenance schedule for the Abbot Optis M system?

The Abbot Optis M is a diagnostic imaging system, and preventative maintenance is crucial for ensuring its accuracy and longevity. A contract duration of 729 days (approximately two years) is a reasonable timeframe for a preventative maintenance agreement for such equipment. It allows for scheduled service intervals (e.g., annual or semi-annual checks) and covers potential needs for software updates or minor part replacements that are part of routine upkeep. This duration balances the need for consistent maintenance with the flexibility to re-evaluate the contract or explore competitive options at its conclusion. It is not excessively long, which could indicate a lack of foresight, nor is it too short, which might suggest uncertainty about the equipment's future needs or the vendor's capability.

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

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3200 LAKESIDE DR, SANTA CLARA, CA, 95054

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: $120,050

Exercised Options: $48,020

Current Obligation: $48,020

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline