P03 Attach 1 FAR 13.5 Sole Source Justification- Over SAT (R2) fully signed.pdf

VHAPG Part 813.5 Simplified Acquisition Procedures for Certain Commercial Items Attachment 1: Request for Sole Source Justification Template >SAT-$7.5M under FAR13.5

Acquisition Plan Action ID: 36C242-23-AP-3949

Effective Date: 02/01/2022 Page 1 of 4

DEPARTMENT OF VETERANS AFFAIRS

SOLE SOURCE JUSTIFICATION UNDER SIMPLIFIED PROCEDURES FOR CERTAIN COMMERCIAL

ITEMS IN ACCORDANCE WITH FAR 13.5

1. Contracting Activity: Department of Veterans Affairs, VISN 2, Network Contracting Office (NCO) 2, 2875 Union Road, Suite 3500, Cheektowaga, NY 14227 procuring the requirement for Department of Veterans Affairs, VISN 02, Northport VA Medical Center, 79 Middleville Rod, Northport, NY 11768.

2237: 632-24-1-454-0005

2. Nature and/or Description of the Action Being Processed: This procurement is for the Northport VA Medical Center (632) for a firm-fixed price preventative maintenance and repair services contract for DRX Evolution and DRX Revolution x-ray systems. This will be a new contract to follow previous contract 36C24219C0046 which ended 9/30/2023. Due to late submission of a requirement package, there will be a gap in services. Verified with COR that no services are being performed until a new contract is in place. The anticipated period of performance is from November 1, 2023 – October 31, 2024 with a provision of four (4) option years. The estimated base year cost is $100,816.64, and the total estimated cost is $834,467.80.

3. Description of Supplies/Services Required to Meet the Agency’s Needs: The Northport VA Medical Center requires a service maintenance plan for DRX Evolution and DRX Revolution x-ray systems currently in use. The services to be provided by the contractor under this contract shall consist of furnishing all labor, equipment, tools, materials, repair service, software updates, parts, etc., for complete On-Site Maintenance and Repair Services. VAMC Northport requires maintenance services to diagnose and correct equipment malfunctions on a routine basis and Biomedical Engineering does not have factory trained and authorized staff to support this equipment.

Equipment includes:

Equipment Catalog# K# Serial# EE#

DRX-Evolution 1268457 46125694 4535 32968

Detector Wireless Band 1&2 1543834 46125694 120100034483

Detector Wireless Band 1&2 1543834 46125694 120100034483

DRX-Evolution 1731678 58009287 6516 46767

DRX GOS Single Detector/Evolution 8001794 58009287 173400045903

DRX GOS Single Detector/Evolution 8001794 58009287 173100045874

DRX-Mobile Retrofit Kit 1000710 46124955 533

Detector Wireless Band 1&2 1543834 46124955 224030100933

DRX-Revolution 8618894 58101413 8547 63790

DRX Plus 3543C Detector 8624850 58101413 224030100933

Effective Date: 02/01/2022 Page 2 of 4

DRX-Revolution 8618894 58101454 8546 63791

DRX Plus 3543C Detector 8624850 58101454 224030100932

DRX-Revolution 8618894 58101418 8548 63789

DRX Plus 3543C Detector 8624850 58101418 224030100930

4. Statutory Authority Permitting Restricted Competition:

FAR 13.5 Simplified Procedures for Certain Commercial Items. The statutory authority for applying the Simplified Procedures for Commercial Items of FAR 13.5 is 41 U.S.C. § 1901 and is implemented by FAR 13.106-1(b)(2) for restricting competition on this procurement. Competition is restricted on this procurement for the reason below:

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

( ) Unusual and Compelling Urgency ( ) Industrial Mobilization, Engineering, Developmental or Research Capability or Expert

Services ( ) International Agreement ( ) Authorized or Required by Statute ( ) National Security ( ) Public Interest

5. Demonstration that the Contractor’s Unique Qualifications or Nature of the Acquisition Requires the Use of the Authority Cited Above (applicability of authority):

Only Carestream Health Inc. has access to their own Original Equipment Manufacturer (OEM) software, including revisions/updates designed to correct identified performance problems or software errors which are covered by the contract. The OEM is uniquely qualified to ensure that all updates are immediately available, properly installed and tested. A non-OEM authorized third-party vendor would not be notified of factory-issued software updates and upgrades. They would not have access to factory diagnostic software tools which could result in their inability to repair, and/or major turn-around-time delays in repair. Third–party service providers would not have access to copies of or knowledge of the OEM-proprietary software which resides on the system.

Non-OEM service providers would also not have factory-trained field-service representatives since Carestream does not offer training to third-party service providers or give them authorization to maintain their systems. A prior employee of the OEM working for a third-party would also not have access to the latest factory-issued circuit and software revisions and updates. The original equipment manufacturer (OEM) Field Service Engineers (FSE) are fully-factory-trained, qualified and experienced in the maintenance inspections and repair requirements. Most importantly, the FSE’s have a full understanding of the entire system, including its proprietary software and hardware components.

Indirect access to OEM-manufactured spare parts would jeopardize repair turn-around time, and that is if one can assume that the OEM will even sell the parts to a non-hospital organization such as a third-party service provider.

Effective Date: 02/01/2022 Page 3 of 4

6. Description of Efforts Made to ensure that offers are solicited from as many potential sources as deemed practicable:

As this is a request for other than full and open competition, no other sources have been deemed suitable offerors, nor are we aware of any existing offerors which could possibly meet our needs other than the OEM, Carestream Health Inc.

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

The estimated base year of $100,816.64 is the exact same cost as previous contract 36C24219C0046 option years 2, 3, and 4. The estimated cost of option year 1 is $173,376.44 and the estimated costs for option years 2 through 4 for the FY24 request are $186,758.24 per year which is around 40% increase from previous contract final option years. This increase is due to the addition of three DRX Revolution systems and three detectors starting at the end of November 2024. Given this information, the pricing offered is determined to be fair and reasonable.

8. Description of the Market Research Conducted and the Results, or a Statement of the Reasons

Market Research Was Not Conducted:

A search conducted on SBA Veteran Small Business Certification (VetCert) website utilizing NAICS 811210 produced 110 results. The VA Rule of Two cannot be met because the required services can only be sourced from one vendor. Also, no VOSB/SDVOSBs responded to the notice of intent to sole source. A search was made at the SBA DSBS website under NAICS code 811210 with keywords “Carestream” and “DRX” produced no results. Conducted a GSA Advantage search for services with keywords “Carestream” and “DRX” which produced no results and GSA Library search only produced results for dental equipment. A search of the NAC MedSurg database was conducted utilizing key words “Carestream” and “DRX” which produced no results.

Notice of Intent to Sole Source, 36C24224Q0013 was posted to Contract Opportunities from September 18, 2023 through September 26, 2023 which received no responses. No response was received from Carestream Health, Inc. due to their submittal of a quote showing their interest.

Capability statements were not required as they are the OEM and already performing services at the Northport VAMC under contract.

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

Carestream Health, Inc. is the sole manufacturer, distributor of parts, and sole provider of Carestream Remote Management Service (RMS) to remotely monitor, diagnose and resolve DRX equipment and software issues.

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

OEM large business, Carestream Health, Inc.

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:

A third-party source would never be qualified to support this system, per statements in Paragraphs 5 and 9; therefore, there are no barriers to be removed to open competition.

Effective Date: 02/01/2022 Page 4 of 4

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.

Emma Zhang Date Biomedical Engineer

Northport VA Medical Center

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

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

Safa Shleiwet Date Contracting Officer

NCO 2, James J. Peters VA Medical Center

b. One Level Above the Contracting Officer (Required over SAT but not exceeding $750K): I certify the justification meets requirements for other than full and open competition.

Janine Childs Date NCO 2 Branch Chief - Services Team II Buffalo VA Medical Center

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 approve ($750K to $7.5 million (or $15.0 million for acquisitions described in FAR 13.500(c)) for other than full and open competition.

Joseph P. Maletta Date Executive Director Regional Procurement Office – East (RPO-E) https://dvagov.sharepoint.com/sites/VHAProcurement/VHAPM/VHAPM_Part_806.3.aspx