HHS Awards $17.4M for US-Made Surgical Masks to American Sanitary Products Inc
Contract Overview
Contract Amount: $17,400,000 ($17.4M)
Contractor: American Sanitary Products Inc
Awarding Agency: Department of Health and Human Services
Start Date: 2024-09-28
End Date: 2027-09-29
Contract Duration: 1,096 days
Daily Burn Rate: $15.9K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Healthcare
Official Description: PURCHASE OF SURGICAL MASKS LEVEL 3 MANUFACTURED IN THE U.S.
Place of Performance
Location: TOLLESON, MARICOPA County, ARIZONA, 85353
State: Arizona Government Spending
Plain-Language Summary
Department of Health and Human Services obligated $17.4 million to AMERICAN SANITARY PRODUCTS INC for work described as: PURCHASE OF SURGICAL MASKS LEVEL 3 MANUFACTURED IN THE U.S. Key points: 1. Significant award for essential medical supplies, manufactured domestically. 2. Competition was full and open, suggesting potential for competitive pricing. 3. Risk is moderate, tied to supply chain reliability and demand fluctuations. 4. Sector focus is healthcare, specifically medical supplies and preparedness.
Value Assessment
Rating: good
The award value of $17.4 million for surgical masks appears reasonable given the quantity and domestic manufacturing requirement. Benchmarking against similar large-scale procurements of Level 3 masks would provide further clarity on pricing efficiency.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating multiple vendors had the opportunity to bid. This method generally promotes competitive pricing and ensures the government receives fair market value.
Taxpayer Impact: The $17.4 million expenditure supports domestic manufacturing and ensures a supply of critical medical equipment, potentially reducing reliance on foreign sources and bolstering national health security.
Public Impact
Ensures a domestic supply of critical Level 3 surgical masks, enhancing national health security. Supports American manufacturing jobs and the domestic medical supply chain. Provides essential personal protective equipment for healthcare professionals and potentially the public.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for price increases due to raw material costs.
- Dependence on a single supplier for a critical item.
- Ensuring consistent quality control for manufactured masks.
Positive Signals
- Domestic manufacturing reduces reliance on foreign supply chains.
- Full and open competition likely secured competitive pricing.
- Long-term contract ensures availability through 2027.
Sector Analysis
This procurement falls within the healthcare sector, specifically medical supplies and personal protective equipment. Spending benchmarks for similar large-scale mask procurements are difficult to establish due to market volatility and varying specifications, but $17.4M for a multi-year supply is substantial.
Small Business Impact
While the award went to American Sanitary Products Inc., the data does not indicate if small businesses were involved as subcontractors or if this contract specifically aimed to support small business participation. Further analysis would be needed to assess SMB impact.
Oversight & Accountability
The contract is managed by the Office of Assistant Secretary for Preparedness and Response (ASPR) within HHS, an agency focused on public health emergencies. Oversight would likely involve monitoring delivery schedules, quality standards, and adherence to contract terms.
Related Government Programs
- All Other Miscellaneous Chemical Product and Preparation Manufacturing
- Department of Health and Human Services Contracting
- Office of Assistant Secretary for Preparedness and Response Programs
Risk Flags
- Domestic manufacturing requirement adds cost but enhances supply chain security.
- Full and open competition suggests a fair price was likely achieved.
- Contract duration provides long-term supply stability.
- Award supports national health preparedness goals.
Tags
all-other-miscellaneous-chemical-product, department-of-health-and-human-services, az, bpa-call, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $17.4 million to AMERICAN SANITARY PRODUCTS INC. PURCHASE OF SURGICAL MASKS LEVEL 3 MANUFACTURED IN THE U.S.
Who is the contractor on this award?
The obligated recipient is AMERICAN SANITARY PRODUCTS INC.
Which agency awarded this contract?
Awarding agency: Department of Health and Human Services (Office of Assistant Secretary for Preparedness and Response).
What is the total obligated amount?
The obligated amount is $17.4 million.
What is the period of performance?
Start: 2024-09-28. End: 2027-09-29.
What is the projected per-unit cost of the surgical masks, and how does it compare to market rates for similar domestically produced Level 3 masks?
The total award is $17.4 million over approximately three years. Without the exact quantity of masks purchased, calculating the precise per-unit cost is impossible. However, a detailed cost analysis comparing this potential per-unit price against industry benchmarks for US-manufactured Level 3 surgical masks would be crucial to assess value for money and identify any potential overpayment.
What are the specific risks associated with relying on American Sanitary Products Inc. for this critical supply, and what mitigation strategies are in place?
Risks include potential production disruptions, quality control failures, or the company's financial instability. Mitigation strategies could involve performance bonds, regular quality audits, contingency planning for alternative suppliers, and clear contract clauses for non-performance. The government should actively monitor the supplier's performance and market conditions.
How effectively does this contract contribute to the government's goal of ensuring a stable and accessible supply of essential medical equipment during emergencies?
This contract directly addresses the goal by securing a significant quantity of domestically produced Level 3 surgical masks through 2027. By fostering domestic manufacturing and ensuring availability via a multi-year BPA call, it strengthens the national stockpile and reduces reliance on potentially volatile international supply chains, thereby enhancing preparedness.
Industry Classification
NAICS: Manufacturing › Other Chemical Product and Preparation Manufacturing › All Other Miscellaneous Chemical Product and Preparation Manufacturing
Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 10115 W VAN BUREN ST, TOLLESON, AZ, 85353
Business Categories: Category Business, Manufacturer of Goods, Service Disabled Veteran Owned Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Veteran Owned Business
Financial Breakdown
Contract Ceiling: $17,400,000
Exercised Options: $17,400,000
Current Obligation: $17,400,000
Actual Outlays: $4,819,608
Contract Characteristics
Commercial Item: PRODUCTS OR SERVICES PURSUANT TO FAR 12.102(F)
Parent Contract
Parent Award PIID: 75A50121A00007
IDV Type: BPA
Timeline
Start Date: 2024-09-28
Current End Date: 2027-09-29
Potential End Date: 2027-09-29 00:00:00
Last Modified: 2025-04-11
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