VA's $26.6M Hearing Aid Contract Awarded to Sonova USA Inc. in May 2025

Contract Overview

Contract Amount: $26,587,501 ($26.6M)

Contractor: Sonova USA Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-05-01

End Date: 2025-05-31

Contract Duration: 30 days

Daily Burn Rate: $886.3K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: EXPRESS MAY: MAY 2025 DATA - PURCHASE ORDER DATA FOR VA NATIONAL HEARING AID CONTRACT.

Place of Performance

Location: AURORA, DUPAGE County, ILLINOIS, 60504

State: Illinois Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $26.6 million to SONOVA USA INC for work described as: EXPRESS MAY: MAY 2025 DATA - PURCHASE ORDER DATA FOR VA NATIONAL HEARING AID CONTRACT. Key points: 1. Significant spending on electromedical apparatus for hearing aids. 2. Sole-source award raises questions about price discovery. 3. Potential for higher costs due to lack of competition. 4. Focus on healthcare sector spending within the VA.

Value Assessment

Rating: questionable

The contract value of $26.6 million for a single month's delivery orders is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to similar VA hearing aid procurements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was not competed, indicating a sole-source or limited competition award. This method can lead to higher prices as there is no market pressure to offer the best value.

Taxpayer Impact: Taxpayer funds may be used less efficiently due to the absence of competitive pricing mechanisms.

Public Impact

Veterans receive essential hearing aid devices. Potential for increased costs impacts overall VA healthcare budget. Ensures availability of critical medical equipment for beneficiaries.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Potential for overpricing
Sole-source award justification needed

Positive Signals

Timely delivery of essential medical equipment
Supports veteran healthcare needs

Sector Analysis

This contract falls within the healthcare sector, specifically for electromedical apparatus manufacturing. VA hearing aid contracts are crucial for veteran audiology services, and spending benchmarks vary based on device complexity and service scope.

Small Business Impact

The data does not indicate any specific provisions or awards made to small businesses under this contract. Further analysis would be needed to determine small business participation.

Oversight & Accountability

The 'NOT COMPETED' status warrants further oversight to ensure the VA followed appropriate procurement regulations for sole-source awards and that the pricing is fair and reasonable.

Related Government Programs

Electromedical and Electrotherapeutic Apparatus Manufacturing
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Sole-source award
Lack of competitive pricing
Potential for overpayment
Limited transparency on justification

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $26.6 million to SONOVA USA INC. EXPRESS MAY: MAY 2025 DATA - PURCHASE ORDER DATA FOR VA NATIONAL HEARING AID CONTRACT.

Who is the contractor on this award?

The obligated recipient is SONOVA USA 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 $26.6 million.

What is the period of performance?

Start: 2025-05-01. End: 2025-05-31.

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

The justification for a sole-source award typically involves circumstances where only one responsible source can provide the required supplies or services. This could be due to unique capabilities, urgent needs, or specific compatibility requirements. Without further documentation, the rationale remains unclear and warrants investigation to ensure it aligns with federal procurement regulations.

What is the risk associated with a sole-source award for hearing aids?

The primary risk of a sole-source award is the potential for inflated pricing due to the absence of competitive pressure. This can lead to inefficient use of taxpayer funds. Additionally, it may limit access to innovative solutions or better value offerings that could emerge in a competitive environment, potentially impacting the quality or cost-effectiveness of hearing aid provision for veterans.

How effective is this contract in meeting the VA's hearing aid needs?

While the contract ensures the delivery of hearing aids, its effectiveness in terms of value for money is questionable due to the sole-source nature. The VA's ability to secure the best possible devices at the most competitive prices is likely compromised. Effectiveness in terms of meeting immediate needs is presumed, but long-term cost-effectiveness and access to advanced technology may be impacted.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Electromedical and Electrotherapeutic Apparatus Manufacturing

Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 750 N COMMONS DR STE 200, AURORA, IL, 60504

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: $26,587,501

Exercised Options: $26,587,501

Current Obligation: $26,587,501

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C79125D0007

IDV Type: IDC

Timeline