DoD Awards $62.6M to Puritan Medical for COVID-19 Swab Production
Contract Overview
Contract Amount: $62,579,591 ($62.6M)
Contractor: Puritan Medical Products Company I LP
Awarding Agency: Department of Defense
Start Date: 2020-07-29
End Date: 2021-07-30
Contract Duration: 366 days
Daily Burn Rate: $171.0K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Healthcare
Official Description: COVID-19 DHHS INDUSTRIAL BASE EXPANSION FOR FLOCK NASAL SWAB PRODUCTION
Place of Performance
Location: GUILFORD, PISCATAQUIS County, MAINE, 04443
State: Maine Government Spending
Plain-Language Summary
Department of Defense obligated $62.6 million to PURITAN MEDICAL PRODUCTS COMPANY I LP for work described as: COVID-19 DHHS INDUSTRIAL BASE EXPANSION FOR FLOCK NASAL SWAB PRODUCTION Key points: 1. Significant award to a single supplier for critical medical supplies. 2. Limited competition raises questions about price discovery and value. 3. Potential risk associated with sole-source procurement during a health crisis. 4. Focus on manufacturing capacity for essential COVID-19 testing components.
Value Assessment
Rating: questionable
The award amount of $62.6 million for 366 days of production is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to potential alternatives or if it includes a premium due to the urgent need.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This approach may have been chosen due to urgency or lack of alternative suppliers, but it bypasses the price discovery benefits of a competitive process.
Taxpayer Impact: Taxpayer funds are being expended without the assurance of the best possible price achievable through competition, potentially leading to overpayment.
Public Impact
Ensures domestic production capacity for critical COVID-19 testing supplies. Supports the industrial base for essential medical equipment during a national emergency. Addresses a critical need for nasal swabs, vital for widespread testing efforts.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits price competition.
- Potential for inflated pricing due to urgent need.
- Reliance on a single supplier for critical items.
Positive Signals
- Addresses critical supply chain need.
- Supports domestic manufacturing.
- Ensures availability of essential testing components.
Sector Analysis
The award falls within the Surgical Appliance and Supplies Manufacturing sector. Spending in this sector surged during the pandemic to meet demand for personal protective equipment and testing supplies. Benchmarks are difficult without competitive data.
Small Business Impact
The awardee, Puritan Medical Products Company I LP, is a significant player in the medical supply industry. There is no indication in the data that this contract specifically benefited small businesses.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny regarding the justification for not pursuing competition. Oversight should focus on ensuring the necessity of the sole-source approach and the reasonableness of the price.
Related Government Programs
- Surgical Appliance and Supplies Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source procurement
- Lack of competitive pricing
- Potential for price inflation
- Urgent need justification
- Single supplier dependency
Tags
surgical-appliance-and-supplies-manufact, department-of-defense, me, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $62.6 million to PURITAN MEDICAL PRODUCTS COMPANY I LP. COVID-19 DHHS INDUSTRIAL BASE EXPANSION FOR FLOCK NASAL SWAB PRODUCTION
Who is the contractor on this award?
The obligated recipient is PURITAN MEDICAL PRODUCTS COMPANY I LP.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Air Force).
What is the total obligated amount?
The obligated amount is $62.6 million.
What is the period of performance?
Start: 2020-07-29. End: 2021-07-30.
What was the specific justification for awarding this contract on a sole-source basis, given the critical need for swabs?
The justification for a sole-source award typically centers on urgency, lack of available alternatives, or unique capabilities. In the context of the COVID-19 pandemic, the rapid and unprecedented demand for nasal swabs likely necessitated swift action to secure supply, potentially leading the Department of Defense to identify Puritan Medical Products as the only viable or timely source.
How can the government ensure fair pricing when awarding large contracts without competition during emergencies?
Ensuring fair pricing without competition is challenging. Agencies can utilize historical pricing data, conduct market research to establish independent cost estimates, engage with industry experts, and negotiate aggressively. Robust internal review processes and justification requirements for sole-source awards are also crucial to mitigate the risk of overpayment.
What is the long-term impact of such sole-source awards on the domestic medical supply industrial base?
Sole-source awards during emergencies can bolster the capacity of specific companies, potentially leading to increased domestic production. However, over-reliance on sole-source contracts without fostering broader competition could stifle innovation and create dependencies, potentially hindering the long-term resilience and competitiveness of the broader industrial base.
Industry Classification
NAICS: Manufacturing › Medical Equipment and Supplies Manufacturing › Surgical Appliance and Supplies Manufacturing
Product/Service Code: INSTALLATION OF EQUIPMENT › INSTALLATION 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: 31 SCHOOL ST, GUILFORD, ME, 04443
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Manufacturer of Goods, Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $62,579,591
Exercised Options: $62,579,591
Current Obligation: $62,579,591
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Timeline
Start Date: 2020-07-29
Current End Date: 2021-07-30
Potential End Date: 2021-07-30 00:00:00
Last Modified: 2021-05-21
More Contracts from Puritan Medical Products Company I LP
- Covid-19 Industrial Base Expansion of Foam TIP Nasal Swabs — $252.9M (Department of Defense)
- 6" Sterile Hydraflock Swab — $15.9K (Department of Health and Human Services)
View all Puritan Medical Products Company I LP federal contracts →
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)