31_JnA Final_APFS SSP and PM_260930.pdf

Request for Sole Source Justification Format >SAT

VHAPG Part 806.3 OFOC Revision: 04 Effective Date: 12/15/25 Acquisition ID#: 36C770-26-AP-0472

DEPARTMENT OF VETERANS AFFAIRS

Justification and Approval (J&A)

For Other Than Full and Open Competition (>SAT)

AUTOMATED PRESCRIPTION FULFILLMENT SYSTEM (APFS)

SERVICE AND SUPPORT PLAN (SSP) & PREVENTATIVE MAINTENANCE (PM) SERVICES

Acquisition Plan Action ID: 36C770-26-AP-0742 2237: 766-26-4-401-0366

1. Contracting Activity: Department of Veterans Affairs, NCO15, Consolidated Mail

Outpatient Pharmacy (CMOP) Charleston-766

Department of Veterans Affairs VA CMOP Charleston-766 4136 Carolina Parkway Ladson, SC 29456

RPO Central Network Contracting Office 15 3540 S. 4th Street Leavenworth, KS 66048

2. Nature and/or Description of the Action Being Approved:

This procurement is for a full Automated Prescription Fulfillment System (APFS) Service and Support Plan (SSP) and Preventative Maintenance Services for the Charleston CMOP APFS is above the Simplified Acquisition Threshold of $9 million in accordance with RFO Part 12 Acquisition of Commercial Products and Services and thus will follow RFO Part 15 Contracting by Negotiation and RFO subpart 6.104 Justification and Approval process.

3. Description of Supplies/Services Required to Meet the Agency’s Needs:

This procurement is for an APFS Service and Support Plan (SSP) and Preventative Maintenance Services of Innovation Associates (dba iA) proprietary Automated Prescription Fulfillment System (APFS) and third party support equipment and provides for 24/7 Emergency Technical Support, Software Support, Hardware Support, Spare Parts and RMA Services for Equipment/Dispensers/Cannisters, Preventative maintenance, and on-site support provided by three (3) iA System Managers.

CMOP requires the APFS Service and Support Plan (SSP) and Preventative Maintenance Services to provide for the maintenance, repair, technical oversight, and operations management of software and hardware components. This complex APFS with multiple subsystems, database infrastructure, interfaces with multiple third-party hardware, and advanced robotics/automation require expertise from the manufacturer/depot level technicians and On-site System Managers (OSM) whenever the system is in operation.

CMOP in-house expertise is able to manage day-to-day maintenance, troubleshooting, and software/network issues, but managing the order management algorithm, database and

Revision: 04 Effective Date: 12/15/25 interface interruptions, and automation malfunctions requires both on-site and readily available off-site technical expertise to mitigate outages. The Charleston CMOP has had an extended warranty since the initial APFS installation and was accepted August 26, 2023, for a three (3) year period and set to expire August 25, 2026.

This procurement will be a new requirement utilizing a Firm Fixed-Price (FFP) contract for one 12-month base period with 12-month option periods.

4. Statutory Authority Permitting Other than Full and Open Competition:

(X) (1) Only One Responsible Source and No Other Supplies or Services Will Satisfy

Agency Requirements per 41 USC §3304(a)(1) as implemented by RFO 6.103-1;

( ) (2) Unusual and Compelling Urgency per 41 USC §3304(a)(2) as implemented by RFO

6.103-2;

( ) (3) Industrial Mobilization, Engineering, Developmental or Research Capability or

Expert Services per 41 USC §3304(a)(3) as implemented by RFO 6.103-3;

( ) (4) International Agreement per 41 USC §3304(a)(4) as implemented by RFO 6.103-4 ( ) (5) Authorized or Required by Statute per 41 USC §3304(a)(5) as implemented by RFO

6.103-5;

( ) (6) National Security per 41 USC §3304(a)(6) as implemented by RFO 6.103-6;

( ) (7) Public Interest per 41 USC §3304(a)(7) as implemented by RFO 6.103-7;

5. Demonstration that the Contractor’s Unique Qualifications or Nature of the

Acquisition Requires the Use of the Authority Cited Above (applicability of authority):

Innovation Associates (dba iA) is uniquely qualified to provide the extended support agreement for the APFS because they are the original equipment manufacturer (OEM) and the sole owner of the system’s proprietary hardware, software, firmware, and diagnostic tools.

The APFS is a highly specialized, integrated system that produces approximately ninety percent (90%) of all prescriptions processed for Veteran patients at Charleston CMOP;

therefore, uninterrupted functionality is essential for CMOP to meet operational requirements and support the VA’s mission. The APFS conveyance architecture and its combination of robotics, labeling, scanning, and automated dispensing subsystems are custom‑engineered to the pharmacy’s formulary, facility size, and physical floorplan, creating a configuration that cannot be serviced, modified, or maintained by any third‑party vendor.

Only the OEM fully understands the interdependencies of these subsystems and possesses the authorized parts, proprietary software, and subject matter experts required to maintain system integrity, accuracy, and compliance with applicable healthcare, safety, and cybersecurity standards. The iA NEXiA and Symphony software suites, along with supporting firmware and configuration utilities, are proprietary and cannot be modified or supported by any entity other than iA without violating licensing and intellectual‑property restrictions.

As stated previously, the APFS installed at Charleston CMOP contains proprietary software, firmware, and hardware uniquely controlled by iA. The system’s design, configuration data, Revision: 04 Effective Date: 12/15/25 and diagnostic tools are not released to third parties, and no open technical data package exists that would enable other vendors to compete for this support requirement.

Because the APFS is deeply integrated into CMOP’s production workflows and information systems, and because its proprietary components and software are controlled exclusively by iA, performance work statements or purchase descriptions suitable for full and open competition cannot be developed without access to the underlying technical data, which is not available to the Government.

This is a new APFS system that was awarded on 7-24-17 and accepted by the VA on 8-25-

23. The extended warranty that is currently in place is set to expire on 8-25-26. There are no other contractors that have the ability and access to proprietary information to this system.

Not using a contractor to maintain the system would risk system failure, extended operational downtime, invalidation of warranties, and potential noncompliance with federal healthcare, safety, and information security requirements, which in turn could jeopardize timely prescription fulfillment for Veterans. Because of the APFS’s critical role, proprietary design, and iA’s exclusive capability to support and sustain the system is required to ensure safe, reliable, and continuous service to Veterans.

6. Description of Efforts Made to ensure that offers are solicited from as many potential sources as possible (including whether a notice was or will be publicized as required by RFO Part 5 and, if not, which exception under RFO Part 5 applies):

iA is uniquely qualified to provide extended support coverage for the APFS because they are the OEM and the sole owner of the system’s proprietary hardware, software, and controls architecture. Their specialized components, diagnostic tools, firmware, and configuration utilities are not available to third‑party vendors, and only iA’s certified technicians are trained and authorized to service, calibrate, and update the system in accordance with manufacturer standards. There is no other provider. Not using the OEM to maintain the system would risk compromising system performance, data integrity, regulatory compliance, and warranty validity.

A Notice of Intent to Sole Source was posted 6-15-26 on SAM.gov in accordance with FAR Subpart 5.2 and the FAR Overhaul (RFO) Part 5 deviation guidance to give industry an opportunity to demonstrate capability. To date, no additional sources have come forward that can meet the requirement to provide an extended support agreement for the APFS that ensures reliable, compliant, and uninterrupted operation by covering critical hardware, software, preventive maintenance, rapid repairs, and secure system updates.

It was determined under 41 U.S.C. 3304(a)(1) (Only One Responsible Source), implemented by FAR 6.302‑1 and the FAR Overhaul (RFO) model deviation text for FAR Part 6 (RFO 6.103‑1), that this survey of the marketplace confirms our assumption that only iA can meet the Government’s needs for this requirement, consistent with RFO 6.104‑1(a)(6).

https://www.acquisition.gov/far-overhaul/far-part-deviation-guide/far-overhaul-part-5 https://www.acquisition.gov/far-overhaul/far-part-deviation-guide/far-overhaul-part-5

Revision: 04 Effective Date: 12/15/25

7. Determination by the CO that the Anticipated Cost to the Government will be Fair and Reasonable:

The anticipated cost for this action will be fair and reasonable based on multiple price analysis methods that collectively demonstrate alignment with current market conditions and prior VA experience for comparable APFS support. The Contracting Officer will compare the offeror’s proposed prices to the Independent Government Cost Estimate (IGCE) which was developed using historical Charleston APFS warranty and support contracts, similar automation support contracts at other CMOPs (including Tucson), and prior actions for preventative maintenance, System Manager support, technical support, and hardware and software support.

The Contracting Officer will further evaluate the reasonableness of proposed labor categories, labor hours, materials, and preventative maintenance schedules; review any proposed discounts or concessions; and assess escalation across the base and option years to ensure prices are consistent with past pricing trends for these services. If required, the Government will request additional cost or pricing data, perform technical evaluations of the proposed effort, and coordinate audit support in accordance with RFO 6.104-1(a)(7) to verify that proposed rates and hours are commensurate with the complexity and criticality of the APFS support.

8. Description of the Market Research Conducted and the Results, or a Statement of the Reasons Market Research Was Not Conducted:

Limited Market Research (related and comparable acquisitions) was conducted as this action must work in conjunction with our current system warranty which used proprietary software. There are similar contracts for certain preventive maintenance aspects of this contract that could seek other potential vendors but could result in uncoordinated efforts of efficiency and increase in overall cost in man-hours.

9. Any Other Facts Supporting the Use of Other than Full and Open Competition:

N/A

10. Listing of Sources that Expressed, in Writing, an Interest in the Acquisition:

An Intent to Sole Source was published on 6-15-26 (Notice ID 36C77026R0011) and no vendors have submitted any potential interest other than Innovation Associates (DBA iA).

11. A Statement of the Actions, if any, the Agency May Take to Remove or Overcome any

Barriers to Competition before Making subsequent acquisitions for the supplies or services required:

The Government will continue to conduct market research to determine whether changes in the marketplace could enable future acquisitions to be competed without increasing risk.

At present, no significant actions are planned that would immediately remove barriers to competition for APFS extended support services. iA retains proprietary control over the APFS

Revision: 04 Effective Date: 12/15/25

WILLIAM

LAVINGHOUSEZ

Digitally signed by WILLIAM

Date: 2026.06.25 14:08:28 -04'00' hardware, software, and technical data necessary to maintain and upgrade the system, which limits the ability to compete these services.

The APFS is a highly complex system involving extensive research, design, and installation, including iterative modifications throughout implementation. Bringing a new system to full operational capability requires years and is not practical to replace at an option period. The new existing system took five years, from time of award in July 2017 until final acceptance in August 2023 to become fully operational. Transitioning to a different vendor would necessitate prolonged system downtime—potentially years—while a replacement system is developed, installed, and validated. This process would also require additional warehouse capacity to sustain ongoing operations during the transition, which may need to be newly constructed if suitable facilities are not available.

Over the longer term, CMOP leadership intends to evaluate and implement new fulfillment systems that may replace or supplement the existing APFS. Once these systems are defined and procured through full and open competition, they may create opportunities for more competitive acquisitions in the future.

12. Requirements Certification: I certify that the requirement outlined in this justification is a Bona Fide Need of the Department of Veterans Affairs and that the supporting data under my cognizance, which are included in the justification, are accurate and complete to the best of my knowledge and belief.

William Lavinghousez, PharmD Director Charleston VA CMOP

13. Approvals in accordance with the VHAPM Part 806.3 OFOC SOP:

a. Contracting Officer Certification (required): I certify that the foregoing justification is accurate and complete to the best of my knowledge and belief.

CHRISTY

PENDLAY

Christy Pendlay Contracting Officer

Digitally signed by CHRISTY

PENDLAY

Date: 2026.07.07 16:44:55 -05'00'

NCO 15, CMOP Service Branch Chief https://dvagov.sharepoint.com/sites/vhapromanual/SitePages/VHAPM-Part-806.3.aspx

RANDALL

COMBS

Digitally signed by RANDALL

COMBS

b. One Level Above the Contracting Officer (Required over SAT but exceeding $900K): I certify the justification meets requirements for other than full and open competition.

Andrew J. Raiber Director of Contracting Network Contracting Office (NCO) 15

c. VHA RPO HCA Review and Approval: I have reviewed the foregoing justification and find it to be complete and accurate to the best of my knowledge and belief and recommend approval (if over $90 million) or approve ($900K to$90 million) for other than full and open competition.

Digitally signed by DARYL

BERG

Date: 2026.07.16 08:57:28 -05'00'

Daryl A. Berg Executive Director, Regional Procurement Office Central VHA Head of Contracting Activity (HCA)

Revision: 04 Effective Date: 12/15/25 Page 6 of 6

DARYL BERG