HHS awards $4.2M for chemistry analyzers, with 5 bids received under full and open competition

Contract Overview

Contract Amount: $4,209,387 ($4.2M)

Contractor: Roche Diagnostics Corporation

Awarding Agency: Department of Health and Human Services

Start Date: 2022-03-29

End Date: 2027-03-31

Contract Duration: 1,828 days

Daily Burn Rate: $2.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: FY22 CPT CHEMISTRY ANALYZER

Place of Performance

Location: INDIANAPOLIS, MARION County, INDIANA, 46256

State: Indiana Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $4.2 million to ROCHE DIAGNOSTICS CORPORATION for work described as: FY22 CPT CHEMISTRY ANALYZER Key points: 1. The contract value represents a significant investment in laboratory diagnostics for the Indian Health Service. 2. Competition dynamics suggest a healthy market for these specialized instruments. 3. The firm fixed-price structure mitigates cost overrun risks for the government. 4. Performance will be measured against delivery timelines and instrument specifications. 5. This spending falls within the broader category of medical equipment procurement for federal health agencies. 6. The duration of the contract indicates a long-term need for these analyzers.

Value Assessment

Rating: good

Benchmarking the $4.2 million award for chemistry analyzers requires specific data on comparable instruments and their pricing. However, the fact that five bids were received suggests competitive pricing was likely achieved. The firm fixed-price contract type also provides cost certainty. Without direct comparisons, it's difficult to definitively assess value, but the competitive bidding process is a positive indicator.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit bids. Five bids were received, indicating a reasonable level of competition for this specialized equipment. The presence of multiple bidders generally leads to better price discovery and potentially lower costs for the government.

Taxpayer Impact: The full and open competition ensures that taxpayer dollars are used efficiently by fostering a competitive environment that drives down prices for essential medical equipment.

Public Impact

Patients served by the Indian Health Service will benefit from improved diagnostic capabilities. The contract delivers analytical laboratory instruments essential for clinical testing. The geographic impact is primarily within the service areas of the Indian Health Service. The contract supports the manufacturing and supply chain workforce involved in producing these analyzers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for obsolescence of technology over the contract's multi-year term.
Dependence on a single manufacturer for critical components and maintenance.
Ensuring adequate training for IHS staff on new analyzer operation.

Positive Signals

Awarded under full and open competition, indicating market availability.
Firm fixed-price contract provides cost certainty.
Long contract duration suggests a stable and ongoing need, allowing for potential volume discounts.
Contractor is a known entity in the diagnostics market.

Sector Analysis

The market for analytical laboratory instruments, including chemistry analyzers, is a significant segment within the broader healthcare technology sector. This contract for $4.2 million is a notable award within this niche. Comparable spending benchmarks would involve looking at other federal agencies procuring similar diagnostic equipment, as well as private healthcare systems. The industry is characterized by technological advancements and a need for reliable, high-throughput instrumentation.

Small Business Impact

There is no indication that this contract included a small business set-aside. Given the specialized nature of analytical laboratory instruments, it is common for such procurements to be dominated by larger manufacturers. Subcontracting opportunities for small businesses are not explicitly detailed but could potentially arise in areas like logistics, installation, or maintenance, depending on the prime contractor's strategy.

Oversight & Accountability

The contract is subject to standard federal procurement oversight. The firm fixed-price nature simplifies financial oversight. Performance monitoring by the Indian Health Service will be crucial to ensure timely delivery and adherence to specifications. Any significant issues could be escalated through agency contracting channels or potentially involve the agency's Inspector General if fraud or abuse is suspected.

Related Government Programs

Department of Veterans Affairs Medical Equipment Procurement
Defense Health Agency Laboratory Services
National Institutes of Health Research Equipment

Risk Flags

Long contract duration may lead to technology obsolescence.
Potential for vendor lock-in regarding maintenance and consumables.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $4.2 million to ROCHE DIAGNOSTICS CORPORATION. FY22 CPT CHEMISTRY ANALYZER

Who is the contractor on this award?

The obligated recipient is ROCHE DIAGNOSTICS CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Indian Health Service).

What is the total obligated amount?

The obligated amount is $4.2 million.

What is the period of performance?

Start: 2022-03-29. End: 2027-03-31.

What is the track record of Roche Diagnostics Corporation in fulfilling federal contracts for similar laboratory equipment?

Roche Diagnostics Corporation is a major global player in the in-vitro diagnostics market and has a history of supplying medical equipment to various federal agencies, including the Department of Health and Human Services and the Department of Defense. Their track record typically involves providing a wide range of diagnostic instruments and reagents. Specific performance data for past federal contracts would require a deeper dive into contract databases to assess on-time delivery, adherence to specifications, and any past performance issues or commendations. However, as a leading manufacturer, they are generally considered a reliable supplier in this sector.

How does the awarded price compare to market rates for similar chemistry analyzers?

A precise comparison of the $4.2 million award to market rates for similar chemistry analyzers is challenging without detailed specifications of the instruments procured and current market pricing. Factors influencing price include the analyzer's throughput, automation level, specific tests it can perform, and included software. Given that five bids were received under full and open competition, it suggests the pricing is likely competitive within the market for high-complexity laboratory instruments. Further analysis would involve obtaining quotes for comparable systems from other manufacturers and considering the total cost of ownership, including reagents and maintenance over the contract's lifespan.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks include potential technological obsolescence over the contract's duration, dependence on a single supplier for critical components and service, and ensuring effective training for Indian Health Service (IHS) personnel. Technological obsolescence is mitigated by the firm fixed-price nature, which locks in costs, and the potential for future procurements of updated technology. Supplier dependence is a standard risk in specialized equipment procurement; mitigation involves robust service level agreements and contingency planning. Training risk is addressed through the contract's performance requirements, ensuring the vendor provides adequate support to IHS staff for optimal instrument utilization and accurate results.

How effective is the Indian Health Service in leveraging this contract to improve patient care?

The effectiveness of this contract in improving patient care hinges on several factors beyond the award itself. The primary benefit is the provision of advanced diagnostic capabilities, which can lead to faster and more accurate diagnoses, enabling timely and appropriate treatment for patients within the IHS system. The success depends on the proper installation, calibration, and maintenance of the analyzers, as well as the proficiency of the laboratory staff using them. Consistent performance monitoring by IHS, including tracking turnaround times for tests and ensuring instrument uptime, is crucial to gauge the contract's direct impact on patient care outcomes.

What are the historical spending patterns for chemistry analyzers by the Indian Health Service or HHS?

Analyzing historical spending patterns for chemistry analyzers by the Indian Health Service (IHS) or the broader Department of Health and Human Services (HHS) would reveal trends in procurement volume, average contract values, and preferred vendors. This specific $4.2 million award needs to be viewed in the context of past investments. If IHS has consistently procured similar analyzers, this award might represent a renewal or upgrade. If spending has been sporadic, it could indicate a new initiative or a response to identified needs. Understanding historical spending helps in assessing whether this award is an anomaly or part of a sustained effort to equip federal health facilities.

What is the expected lifespan and utility of the procured chemistry analyzers?

The contract duration is set to end on March 31, 2027, implying a useful life for the analyzers that extends beyond this period, or at least covers the period of active need and support. Chemistry analyzers typically have a functional lifespan of 5-10 years, depending on usage, maintenance, and technological advancements. The utility of these specific analyzers will be determined by their ability to meet the diagnostic needs of the Indian Health Service facilities they are deployed in, including test menu breadth, throughput capacity, and reliability. The firm fixed-price nature suggests the government is acquiring the equipment outright or for a defined period, with the expectation of significant utility during that time.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Analytical Laboratory Instrument Manufacturing

Product/Service Code: INSTRUMENTS AND LABORATORY EQPT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: RFQ1497617

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Roche Holding AG

Address: 9115 HAGUE RD, INDIANAPOLIS, IN, 46256

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $5,014,064

Exercised Options: $4,209,387

Current Obligation: $4,209,387

Actual Outlays: $3,173,307

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: V797P7347A

IDV Type: FSS

Timeline