P03-24-008387 JOFOC Machaon Diagnostics _Redacted.pdf

Justification for Other than Full and Open Competition

“Source Selection Information – see FAR 2.101 and 3.104”

1. Identification of the agency and contracting activity.

a. Federal agency and contracting activity. HHS.

National Institute of Health Clinical Center Office of Purchasing and Contracts

b. Sponsoring organization.

National Institute of Health Clinical Center Department of Laboratory Medicine

c. Project Officer information.

Project Officer name.

Mailing address. Department of Laboratory Medicine

NIH Clinical Center 10 Center Drive, Room 2C301 Bethesda, MD 20892

E-mail address.

Telephone number. (301)

2. Nature and/or description of the action being approved.

a. Acquisition purpose and objectives.

The National Institutes of Health, Office of Purchasing and Contracts on behalf the Department of Laboratory Medicine intends to award a sole source firm-fixed price contract to Machaon Diagnostics Laboratories to provide reference laboratory testing.

b. Project background.

The Department of Laboratory Medicine has a bone fide need to establish a new agreement for testing services. (See attached document for CXCL9 justification) CXCL9 is a laboratory test that differentiates hemophagocytic lymphohistiocytosis (HLH) from sepsis and persistent systemic inflammatory response syndrome (SIRS). Knowing CXCL9 levels in patients with inflammatory diseases has been found to be crucial in diagnosing life-threatening hyperinflammatory syndromes such as hemophagocytic lymphohistiocytosis (HLH) and macrophage activation syndrome (MAS). CXCL9 serves as a surrogate marker for Interferon gamma activity (IFNy) and helps differentiate HLH/MAS from more common inflammatory syndromes such as sepsis. HLH/MAS can occur from a variety of triggers including in hematologic malignancies, autoimmune diseases, immunomodulating therapies, and primary immunodeficiencies. CXCL9 is the best marker for monitoring disease activity in patients with HLH/MAS and it is also helpful in predicting response to initial therapy. For those with refractory inflammatory disease, CXCL9 levels play a key role in guiding treatment decisions and the turnaround time for results is crucial; having results available to the clinician within 36-96 hours is extremely important.

The Department of Laboratory Medicine has a contract awarded to . for the period of performance 02/01/2024-01/31/2025 in place for reference Laboratory for testing services. However, the current vendor turnaround time (TAT) is 7-12 days and doesn’t meet the required TAT for clinical diagnosis and treatment protocols. The current vendor uses a 3rd party reference lab, where the testing is only performed once a week which extends the processing time and delays the Turnaround time for results. The delay in obtaining results doesn’t meet the required guidance and best practice for the specialized care and treatment for patients needed with inflammatory syndromes.

These services cannot be performed in house as DLM doesn’t have the adequate and proper equipment, reagent, or the capability to perform this specific testing.

The following details are why CXCL9 levels are crucial for NIH CC patients and a rapid TAT is crucial.

Machaon Diagnostic Laboratories is the only source that offers and performs CXCL9 level testing services at their facility which is not available from other reference laboratories; the other reference labs forward the testing to a 3rd party vendor. The proposed vendor performs testing daily Monday through Friday with results being reported on the same day testing is performed.

Machaon does offer other tests that NIH CC DLM or other approved reference labs do not provide testing for that may be utilized in the future if new protocols are requiring the other offered tests.

Having CXCL9 levels results available within 36 to 96 hours is critical; with decrease levels in providing guidance if emapalumab treatment is working or not in HLH and MAS patients.

CXCL9 is a key surrogate marker for interferon gamma activity (IFNg).

CXCL9 plays essential role in diagnosis and management for patients with Hemophagocytic lympohistiocytosis (HLH) and macrophage activation syndrome

(MAS).

CXCL was added to recent American College of Rheumatology (ACR) and European Alliance of Associations for Rheumatology (EULAR) guidelines for the evaluation and management of HLH.

NIH has several protocols that utilize CXCL9 testing to diagnosis HLH from other systemic inflammatory response syndromes (SIRS)and Sepsis.

The number of CXCL9 levels requests at NIH for the above patients with HLH, Mas, or other systemic inflammatory response syndromes (SIRS) and sepsis is 400 or more per year.

NIH patients with HLH is life-threatening and often are in the ICU which is essential for a rapid Turnaround time.

Depending on the CXCL9 results will determine if the inflammation will be refractory to first line medications verses aggressive and costly medications.

HLH is strongly associated with mortality, CXCL9 guides treatment decisions in an acute setting when the patient is often rapidly progressing.

Rapid turnaround time allows for cost-effective utilization to expensive pharmaceuticals; if the CXCL9 level is not elevated these drugs will no longer be inappropriately given with treatment protocols adjusted.

CXCL9 is the most important biomarker for diagnosis and management of HLH.

Utilizing a rapid Turnaround time improves mortality, decreases need for intensive care, improves the cost-effective utilization of aggressive medications, and ultimately improves outcomes for patients with HLH.

There was a thorough review of all approved reference labs ) that have CXCL9 testing, and their current TAT is the same as the current vendor that DLM is utilizing, and each reference lab sends to a 3rd party vendor. doesn’t provide CXCL9 testing on their test menu.

3. Description of the supplies or services required to meet the agency’s needs (including the estimated value:

a. Project title. Machaon Diagnostics Laboratory Testing Services

Project description. See attached Statement of Work.

Requirement type.

Research & development (R&D) R & D support services Support services (non-R&D)

Supplies/equipment Information technology (IT) Construction Architect-engineer (A & E) services Design-build Other (specify): ____________________

Type of action.

New requirement Follow-on Other (specify): ______________________

Proposed contract/order type.

Firm-fixed-price

Other fixed-price (specify, e.g., fixed-price award-fee, fixed-price incentive-fee): __________

Cost-plus-fixed-fee Other cost reimbursement (specify, e.g., cost-plus-award-fee, cost-plus-incentive-fee): ___________

Time and materials Indefinite delivery (specify whether indefinite quantity, definite quantity, or requirements): _indefinite quantity_ Other (specify): ___________ Completion Form Term form.

Acquisition identification number. To be determined.

4. Total estimated dollar value and performance/delivery period.

The anticipated period of performance is a base year and four option years.

Period of Performance: Estimate Base Year: 09/15/2024-09/14/2025 $ Option Year One: 09/15/2025-09/14/2026 $ Option Year Two: 09/15/2026-09/14/2027 $ Option Year Three: 09/15/2027-09/14/2028 $ Option Year Four: 09/15/2028-09/14/2029 $145,080.00 Estimated Grand Total: $

a. Identification of the statutory authority permitting other than full and open competition.

This acquisition is conducted under the authority of 41 United States Code (U.S.C.)

1901 as set forth in Federal Acquisition Regulation (FAR) authority of Subpart 13.5.

This acquisition is conducted under the authority of section 4202 of the Clinger- Cohen Act of 1996.

This acquisition is conducted under the authority of the Services Acquisition Reform Act of 2003 (41 U.S.C. 428a).

5. Demonstration that the proposed contractor(s) unique qualifications or the nature of the acquisition requires use of the authority cited.

a. Name and address of the proposed contractor(s).

Proposed Contractor:

Machaon Diagnostics, Inc.

2023 Eight Street Berkeley, CA 94710 T-(800) 566-3462

SAM UIE:

Expires:

b. Nature of the acquisition and proposed unique qualifications of the contractor(s).

Machaon Diagnostics, Inc. is the only source capable of meeting the government’s requirement.

Machaon Diagnostics, Inc. Clinical lab is the only Clinical Laboratory that can provide CXCL9 with the fastest and efficient turnaround time (24-48 hours from time vendor receives sample).

NIH has several protocols that utilize CXCL9 testing to diagnosis HLH from other systemic inflammatory response syndromes (SIRS)and Sepsis.

Clinical center patients with HLH are life-threatening and often are in the intensive care unit (ICU) which is essential for a rapid turnaround time.

Other laboratories can’t meet or exceed this turnaround time. This is why Machaon Diagnostic, inc. Clinical Laboratory is the only laboratory to ensure the NIH and the Clinical Center’s patients are provided with he best and fastest patient care.

Machaon Diagnostics, Inc. is Clinical Laboratory Improvement amendments (CLIA) certified laboratory.

CXCL9 testing is performed at Machaon Diagnostics in house and not sent to a 3rd party reference laboratory.

Performs testing daily Monday through Friday with same day resulting.

Meets the rapid turnaround time required for patient care and treatment guidelines. (24-48 hours from time vendor receives)

Samples are collected and sent same day to vendor for overnight delivery.

Has online portal to request testing service capabilities.

Provides quality assurance reports and business reviews.

Offers other laboratory tests that DLM may require utilizing in the future.

6. Description of the efforts made to ensure that offers are solicited from as many potential sources as practicable. Indicate whether a SAM.gov notice was or will be publicized as required by FAR Subpart 5.2 and, if not, which exception under FAR 5.202 applies.

In efforts to reach as many potential sources as possible and a pre-solicitation notice was published on the government point of entry at Contract Opportunities on https://www.sam.gov on 06/24/2024 through 07/05/2024. It was brought to the Office of Purchasing and Contracts, the wrong NAICS code was used. NAICS Code 541380 - Testing Laboratories and Services was used instead of NAICS Code: 621511-Medical Laboratories ($41.5 M Average Annual Receipts).

The Notice of Intent was republished under NAICS Code: 621511-Medical Laboratories ($41.5 M Average Annual Receipts) on 07/17/2027 through 07/29/2024. There was no response to the notice.

There was no response to the notice. Therefore, this requirement will not be competed and awarded to Machaon Diagnostics, Inc. on a sole source basis.

7. Determination by the Contracting Officer that the anticipated cost/price to the Government will be fair and reasonable.

The government independent cost estimate for this project was submitted in the amount of for the base and all four option years totaling

Period of Performance:

Base Year: 09/15/2024-09/14/2025 Option Year One: 09/15/2025-09/14/2026 Option Year Two: 09/15/2026-09/14/2027 Option Year Three: 09/15/2027-09/14/2028 Option Year Four: 09/15/2028-09/14/2029 Estimated Grand Total:

A price analysis was conducted to determine if the contractor’s pricing is fair and reasonable to the government for this project. (FAR 13.103-3(a)(2)(ii)) A comparison of the proposed price with prices found reasonable on previous purchases was performed and FAR 13.103-3(a)(2)(iii)) with current price lists, catalogs, or advertisements. However, inclusion of a price in a price list, catalog, or advertisement does not, in and of itself, establish fairness and reasonableness of the price. The contractor’s proposed price for CXCL9 testing in the amount of per test.

When comparing , s proposed pricing of $ to of catalog pricing, pricing is higher than . When comparing

.’s proposed pricing of per test against S s current contract pricing of per test, contract pricing is higher than ’ by . When comparing proposed pricing of to and

, proposed pricing provides the lowest price to the government. pricing is the lowest price and provides the overall best benefit to the government in fulfilling this requirement. It is determined that proposed pricing of is fair and reasonable to the government.

Pricing Per Test

. Description of the market research conducted (see FAR Part 10) and the results, or a statement of the reasons market research was not conducted.

Market research was conducted in accordance with FAR Part 10. A pre-solicitation notice was published on the government point of entry at Contract Opportunities on https://www.sam.gov on 06/24/2024 through 07/05/2024. It was brought to the Office of Purchasing and Contracts, the wrong NAICS code was being used NAICS Code 541380 - Testing Laboratories and Services was used instead of NAICS Code: 621511-Medical Laboratories ($41.5 M Average Annual Receipts). The pre-solicitation notice was republished of the government’s intent to sole source to Machaon Diagnostics. The Notice of Intent was republished under NAICS Code: 621511-

Medical Laboratories ($41.5 M Average Annual Receipts) on 07/17/2027 through 07/29/2024.

No response was received to the republished notice. Therefore, based on market research there is no other source capable of fulfilling the government’s requirement other than Machaon Diagnostics. This requirement will not be competed, and a firm-fixed priced contract will be awarded to Machaon Diagnostics, Inc (Other Than Large Business) on a sole source basis.

9. Any other facts supporting the use of other than full and open competition.

None.

10. Listing of sources, if any, that expressed, in writing, an interest in the acquisition.

Firm: 0001

T-( (888)

Socio-economic Status: Service-Disabled Veteran Owned Small Business

One source responded in writing to the pre-solicitation notice after the notice had expired. On Sunday, July 14, 2024, submitted a technical capability statement in response to the pre-solicitation notice that expired July 5, 2024. It was during communications with that the Office of Purchasing and Contracts discovered the wrong NAICS of 541380 - Testing Laboratories and Services code was published and that a new pre-solicitation notice would have to be re-issued with the correct NAICS of 621511 - Medical Laboratories. The pre-solicitation notice was reissued with the correct NAICS Code of 621511 was published on July 17, 2024, through July 29, 2024. No response was received to the republished notice.

Therefore, based on market research there is no other source capable of fulfilling the government’s requirement other than Machaon Diagnostics. This requirement will not be competed, and a firm-fixed priced contract will be awarded to Machaon Diagnostics, Inc (Other Than Large Business) on a sole source basis.

11. Statement of the actions, if any, the agency may take to remove or overcome any barriers to competition before any subsequent acquisition for the required supplies or services.

This is an ongoing requirement, and the government will continue to conduct market research to determine capability and if the requirement can be competed.

12. Program office certification.

This is to certify that the portions of this justification that have been developed by the undersigned program office personnel, including supporting information and/or data verifying the Government’s minimum needs, schedule requirements and other rationale for other than full and open competition, are accurate and complete.