VA awards $1.2M for ultrasound systems, raising questions about competition and value

Contract Overview

Contract Amount: $120,000 ($120.0K)

Contractor: Abbott Laboratories Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2026-04-20

End Date: 2026-06-22

Contract Duration: 63 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: VIEWMATE MULTI ULTRASOUND SYSTEM

Place of Performance

Location: IOWA CITY, JOHNSON County, IOWA, 52246

State: Iowa Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $120,000 to ABBOTT LABORATORIES INC. for work described as: VIEWMATE MULTI ULTRASOUND SYSTEM Key points: 1. Contract awarded via sole-source justification, limiting price discovery and potentially increasing costs. 2. Limited competition raises concerns about achieving best value for taxpayer funds. 3. The contract duration of 63 days is unusually short for a system procurement. 4. No small business set-aside was utilized, despite potential for subcontracting opportunities. 5. The specific product, VIEWMATE MULTI ULTRASOUND SYSTEM, suggests a specialized need. 6. The award date is significantly before the period of performance, indicating early planning.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the lack of competitive bidding and the specific nature of the 'VIEWMATE MULTI ULTRASOUND SYSTEM'. Without comparable bids, it's difficult to assess if the $1.2 million price represents a fair market value. The short performance period also raises questions about whether this represents a full solution or a temporary measure, impacting the overall value assessment. Further analysis of the sole-source justification is needed to understand the pricing rationale.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a sole-source justification, meaning only one vendor, Abbott Laboratories Inc., was solicited. This approach bypasses the standard competitive bidding process, which typically involves multiple vendors submitting proposals. While sole-source awards can be justified in specific circumstances (e.g., unique capabilities, urgent needs), they inherently limit price discovery and can lead to higher costs for the government compared to a fully competed contract. The lack of competition here means taxpayers may not have received the most cost-effective solution.

Taxpayer Impact: Sole-source awards limit the government's ability to negotiate the best possible price, potentially resulting in higher expenditures for taxpayers. The absence of competition means taxpayers are reliant on the vendor's pricing without market validation.

Public Impact

Veterans receiving medical care will benefit from the availability of advanced ultrasound systems. The Department of Veterans Affairs (VA) will receive surgical and medical instruments. The geographic impact is likely concentrated within VA facilities in Iowa, where the contract is managed. The procurement supports the healthcare sector workforce by providing necessary medical equipment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Sole-source award limits transparency in pricing.
Short contract duration raises questions about long-term planning and value.
Absence of small business participation limits economic opportunities.

Positive Signals

Procurement of advanced medical technology for veteran care.
Clear contract award with defined performance period.
Established contractor with a long history (founded 1905).

Sector Analysis

The medical device manufacturing sector is characterized by high innovation and significant R&D investment. Contracts for specialized equipment like ultrasound systems are crucial for healthcare providers to deliver advanced diagnostic and therapeutic services. The market includes a range of large, established companies and smaller, specialized firms. Spending in this category is driven by technological advancements, healthcare demand, and government healthcare initiatives, such as those within the VA. Comparable spending benchmarks would typically involve analyzing other sole-source or competitively awarded contracts for similar ultrasound systems across federal agencies.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to include specific subcontracting requirements for small businesses. Given the nature of medical equipment procurement, there may be opportunities for small businesses to participate as subcontractors for installation, maintenance, or related services. However, the sole-source nature of this award limits the visibility and potential for small business engagement that a competitive process might offer.

Oversight & Accountability

The Department of Veterans Affairs (VA) has established oversight mechanisms for its procurements, including internal review processes and compliance with federal acquisition regulations. Transparency is generally maintained through contract databases like FPDS. Inspector General oversight is also in place to investigate fraud, waste, and abuse within VA contracts. However, the sole-source nature of this award warrants closer scrutiny to ensure the justification was sound and the pricing is reasonable.

Related Government Programs

Medical Equipment Procurement
Surgical and Medical Instrument Manufacturing
Department of Veterans Affairs Healthcare Services
Sole-Source Procurements

Risk Flags

Sole-source award lacks competitive justification.
High dollar amount for a short-duration contract.
Potential for non-competitive pricing.
Limited transparency in procurement process.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $120,000 to ABBOTT LABORATORIES INC.. VIEWMATE MULTI ULTRASOUND SYSTEM

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 $120,000.

What is the period of performance?

Start: 2026-04-20. End: 2026-06-22.

What is the specific justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was 'NOT COMPETED'. A sole-source award typically requires a detailed justification from the agency explaining why only one vendor can meet the requirement. Common reasons include unique technical capabilities, proprietary technology, urgent and compelling needs where competition is not feasible, or when only one responsible source exists. For this specific contract, the VA would need to document why Abbott Laboratories Inc. and its VIEWMATE MULTI ULTRASOUND SYSTEM were the only viable option. Without this documentation, it's difficult to fully assess the necessity of bypassing the competitive process and its potential impact on cost.

How does the $1.2 million price compare to similar ultrasound systems purchased by the government or in the commercial market?

Direct price comparison is difficult without knowing the exact specifications and configuration of the VIEWMATE MULTI ULTRASOUND SYSTEM. However, $1.2 million for a single ultrasound system, especially with a short 63-day performance period, appears to be on the higher end, particularly if it's not a comprehensive package including multiple units or extensive service agreements. Typically, advanced ultrasound systems can range from tens of thousands to several hundred thousand dollars, depending on features and intended use. The lack of competitive bidding prevents a clear benchmark against market rates or other government contracts for similar equipment, raising concerns about potential overpayment.

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

The primary risk of a sole-source award for medical equipment is the potential for inflated pricing due to the absence of competition. Without competing bids, the government cannot be assured it is receiving the best possible price. Other risks include limited innovation, as vendors may not feel compelled to offer their most advanced or cost-effective solutions. Furthermore, sole-source awards can create a perception of favoritism or lack of transparency, potentially undermining public trust. For critical medical equipment, ensuring fair pricing and access to reliable technology is paramount, making competitive processes generally preferable.

What is Abbott Laboratories Inc.'s track record with the VA and other federal agencies?

Abbott Laboratories Inc. is a large, established healthcare company with a significant history of supplying medical products and services. A review of federal procurement data would likely show numerous contracts awarded to Abbott Laboratories Inc. across various agencies, including the Department of Veterans Affairs, Department of Defense, and others. Their long operational history (founded 1888, though the data provided states 1905 for 'br') suggests experience and a substantial presence in the federal market. However, the specific track record for supplying ultrasound systems, particularly sole-source awards, would require a deeper dive into contract history to assess performance and pricing patterns.

What does the short contract duration (63 days) imply for the procurement strategy?

A contract duration of only 63 days for the procurement of a VIEWMATE MULTI ULTRASOUND SYSTEM is exceptionally short. This could imply several possibilities: it might be an interim solution to address an immediate, critical need while a longer-term, competitive procurement is planned; it could be for a specific, short-term project or evaluation; or it might represent a lease or rental agreement rather than a full purchase. The short duration raises questions about the overall strategic planning for medical equipment acquisition within the VA and whether this represents a sustainable approach to equipping healthcare facilities.

Are there any indications of potential waste, fraud, or abuse associated with this type of sole-source award?

While the data itself does not indicate fraud, waste, or abuse, sole-source awards inherently carry a higher risk profile in these areas due to reduced transparency and competition. The absence of multiple bids means there are fewer checks and balances to ensure the price is fair and the need is genuine. Oversight bodies like the VA's Office of Inspector General (OIG) would typically scrutinize sole-source justifications, especially for significant dollar amounts. Without access to the specific justification documentation and subsequent performance reviews, it's impossible to definitively rule out potential inefficiencies or improper pricing, highlighting the importance of robust agency oversight.

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: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 36C26326Q0471

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: $120,000

Exercised Options: $120,000

Current Obligation: $120,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline