36C25026Q0292.pdf

Combined Synopsis/Solicitation Notice

*= Required Field Combined Synopsis/Solicitation Notice

SUBJECT* Contingency Hazardous Compounding Services VHA VISN 10 VA Medical Facilities

GENERAL INFORMATION

CONTRACTING OFFICE’S ZIP CODE* 45409-1337

SOLICITATION NUMBER* 36C25026Q0292

RESPONSE DATE/TIME/ZONE 03-20-2026 13:30 EASTERN TIME, NEW YORK,

USA

ARCHIVE 60 DAYS AFTER THE RESPONSE DATE

RECOVERY ACT FUNDS N

SET-ASIDE

PRODUCT SERVICE CODE* Q517

NAICS CODE* 621999

CONTRACTING OFFICE ADDRESS

Department of Veterans Affairs Network Contracting Office (NCO - 10) 3140 Governor’s Place Blvd. Suite 210 Kettering OH 45409-1337

POINT OF CONTACT*

Contracting Officer Josh Kovar Joshua.Kovar@VA.gov Phone calls will not be entertained

All Questions shall be emailed to POC above

PLACE OF PERFORMANCE

ADDRESS US Department of Veterans Affairs VHA VISN 10 VA Medical Centers Multiple facilities, Please see PWS Locations in Indiana, Ohio, and Michigan

POSTAL CODE

COUNTRY

ADDITIONAL INFORMATION

AGENCY’S URL

URL DESCRIPTION

AGENCY CONTACT’S EMAIL ADDRESS

EMAIL DESCRIPTION

DESCRIPTION

This is a solicitation for commercial items prepared in accordance with the format in Federal Acquisition Regulation (FAR/RFO) subpart 12.6, “Streamlined Procedures for Evaluation and Solicitation for Commercial Items,” as supplemented with additional information included in this notice. This solicitation is issued as an RFQ. The solicitation document and incorporated provisions and clauses are those in effect through Federal Acquisition Circular 2025-06.

• This solicitation is not set aside; it is a Full and Open Competition.

• All vendors shall provide all requested information in Quote Preparation Instructions section.

• There is a question and answer period for this requirement, ending at 1:30 PM EST on 3/13/2026

The associated North American Industrial Classification System (NAICS) code for this procurement is 621999

– All Other Miscellaneous Ambulatory Health Care Services, with a small business size standard of $20.5 Million. The FSC/PSC is Q517 – Medical – Pharmacy Services.

VHA VISN 10 VA Medical facilities are requesting Hazardous Compounding services to be utilized as a contingency.

All interested companies shall provide quotations for the following:

PRICE/COST SCHEDULE

This is a requirements contract with no minimum guaranteed amount. The maximum total value of the contract (Contract Ceiling amount), inclusive of the base year and all options exercised, shall not exceed $8,500,000.00. Individual task orders shall be funded at the time that the need exists.

Task order minimums and maximums are addressed in clause FAR 52.216-19.

Vendor shall invoice monthly, for ONLY actual services rendered. DO NOT perform any services other than those identified in the Price-Cost Schedule, unless the ACO has issued a modification to the contract to add a CUN for that specific action.

Contractor shall invoice for actual performance and shall indicate CLINs/SLINS Numbers from the contract on all Tungsten Network invoices.

Individual task orders shall be funded as the need arises. The Contracting Officer is the only authorized individual that can place task orders against this contract for the estimated amount of services for the specific timeframe, and the task orders shall be issued to the contractor. Offerors shall offer pricing for the entire estimated quantity for each CLIN.

Are items listed below are estimated quantities: CLINS/SLINS 0001, and 0002 and subsequent option year

CLINS/SLINS.

ITEM INFORMATION

Please refer to the Price-Cost Schedule Excel file, which will be used both to identify estimated drugs, their usage, and to provide vendor price quotes.

Price-Cost Schedule 26Q0292.xls file is located in Document attachments.

All drug pricing (CLIN 0001AA–FC), covering 122 items, is listed at Average Wholesale Price (AWP) ± 0.00% as of the date the schedule was created. AWP is dynamic and will fluctuate based on wholesale market changes. Pricing for all drugs will be updated to reflect the actual price at the date and time of order, per PWS (Scope) item #16.

Any therapies not identified in the schedule will be added with a valid NDC at the time of Task Order creation.

These therapies will be incorporated by subtracting the number of drugs added from Row 125 (Other (AWP + (? %) Drugs Not Listed Above)), per PWS (Scope) item #15.

Vendors shall provide the following pricing data for each tab of the Excel file (Base Year, Option Year 1, Option Year 2, Option Year 3, and Option Year 4):

• AWP Discount/Surcharge in cell F2

• Per Diem Fees in cell F128

• Chemoembolic Mixing Fee in cell F129

• Exact Volume Requirement Fee in cell F130

• Intrathecal Mixing Fee in cell F131

• STAT Order Fee in cell F132

• Discount off list price for supplies in cell G134

Pricing for each individual year will be automatically calculated based on the data entered in the fields above and will populate both the individual year tabs and the Totals tab.

PERFORMANCE WORK STATEMENT

Updated 2/26/2026

VA Healthcare System Serving Indiana, Michigan, and Ohio (VISN 10) Pharmacy Service Compounded Sterile Hazardous Pharmaceuticals

1. BACKGROUND:

VISN 10 has identified a need for a contractor to compound hazardous drugs such as chemotherapy agents based on patient-specific prescriptions for VISN 10 locations. These compounding services are necessary to provide treatment to Veterans diagnosed with specific medical conditions. The compounding must be done at a Food and Drug Administration (FDA) 503A compliant facility and meet all state and federal laws.

VISN 10 Pharmacy would like to award a “requirements” contract. A participating VISN 10 facility would activate or begin using the contract as a contingency when they are not able to compound these agents on their own for a variety of reasons. When the contract is used, it will be needed on an urgent basis. This would occur when contracting issues a task order against this contract. No compounding orders should be placed or provided until the task order is signed by the Contracting Officer.

Prices received during the period of activation are firm-fixed and should include the cost of the drug, compounding fee, and/or shipping costs. There is no guaranteed minimum value over the life of this contract.

The Government makes no guarantees regarding orders.

2. SCOPE:

Contractor shall provide all chemotherapy agents, intravenous (IV) tubing, closed system drug transfer devices (brand specified by the facility), and any other items deemed necessary. All Hazardous Chemotherapy Agents will be aseptically compounded based on patient specific orders.

3. NOTE:

The Government reserves the right to add or remove any additional Medical Centers, Community Based Outpatient Clinics (CBOCs), or other facilities to the contract as they become available. Furthermore, the Government reserves the right to add, increase, or decrease the number of drugs, or other directly attributable items to allow for fluctuations of client demand that are otherwise unknown at the time of solicitation. The total contract value may increase up to 20% of the base award but shall not eclipse the Contract Ceiling identified in the Price-Cost Schedule Section.

4. PERIOD OF PERFORMANCE

• BASE Year – 5/1/2026 – 4/30/27

• Option Year 1 – 5/1/2027 – 4/30/2028

• Option Year 2 – 5/1/2028 – 4/30/2029

• Option Year 3 – 5/1/2029 – 4/30/2030

• Option Year 4 – 5/1/2030 – 4/30/2031

5. ORDERING REQUIREMENTS

5.1 Orders will be submitted via a secure network and will include the information listed below. Once submitted, VA staff will confirm receipt of order with the Contractor via phone or email.

a. Patient name

b. Gender

c. DOB

d. Height

e. Weight

f. Allergies

g. Drug dosage

h. Diluent and Volume

i. Infusion Rate (if not noted, label will read ‘Infuse per hospital protocol’)

j. Procedure date

k. Prescribing physician

6. ORDER SUBMISSION AND DELIVERY REQUIREMENTS

6.1 Orders from the VA will be submitted by 3:00 PM EST the day prior to the needed chemotherapy infusion.

6.2 Compounded orders shall be transported via courier, overnight mail service, or any other means necessary to ensure receipt prior to infusion date/time indicated.

6.3 Items shall be delivered to the VA location by 9:00 AM EST, the day after orders are submitted.

7. COMPOUNDING AND LABELING REQUIREMENTS

7.1 Compounding, labeling, and beyond use dating/expiration dating will be based on manufacturer labeling, United States Pharmacopeia (USP) 797, USP 800 and Federal Law.

7.2 Finished product should be labeled with proper beyond use dating based on manufacturer labeling or documentation for extended stability.

8. DRUG SUPPLY REQUIREMENTS

8.1 All drugs are to be supplied by the Contractor. Each facility will provide a list of common chemotherapy agents used at the time the task order is issued for that facility. This list is not inclusive, and other agents may be used as needed for patient needs without modification of this contract.

9. PRICING METHODOLOGY

9.1 AWP DEFINITION AND APPLICATION

For the purposes of this contract, the Average Wholesale Price (AWP) is defined as the published pricing benchmark for pharmaceuticals as listed in nationally recognized drug pricing compendia (e.g., First Databank, Medi-Span, or Red Book). The Government will apply the AWP in effect at the date and time the request is made, plus or minus any applicable discounts identified in the Price-Cost Schedule. Because AWP fluctuates and is not a fixed index suitable for use under FAR Economic Price Adjustment clauses, AWP shall not be used as the basis for automatic or periodic contract price adjustments. The Contractor shall provide the applicable AWP source and publication date for all invoiced drugs. The Government may adjust drug pricing at task order placement to reflect the AWP or catalog pricing in effect at that time, applying the agreed-upon discount structure.

9.2 The amount billed for the drugs should not exceed AWP plus 5% at the time of service. Actual percentage shall be updated after the solicitation.

10. SHIPPING REQUIREMENTS

10.1 Shipping is included with the order and there is no additional cost for any items delivered during the weekend or a holiday. All shipments for weekend and/or holiday delivery will be arranged as needed to ensure delivery can be successfully completed.

11. CONTRACTOR CERTIFICATION AND COMPLIANCE REQUIREMENTS

11.1 Contractor shall provide all current and future certification reports for the sterile compounding areas and compounding hoods during the time period that the contract is utilized. Additionally, the contractor shall provide

12 months of certification reports to the facility and VISN prior to utilization to ensure that there are no issues.

In the case of any failures, contractor shall provide action plans for corrections of deficiencies and testing results showing the failures have been corrected.

11.2 Contractor shall update and provide the “Veterans Health Administration Pharmacy Benefit Management Assessment Guide for Compounded Sterile Preparations within Veteran Administration Medical Centers and Outsourced Compounding Pharmacies” at time of solicitation response and annually (See Attachment 1).

12. STAT ORDER REQUIREMENTS

12.1 STAT orders are considered orders sent to the vendor after the 3:00 PM EST cut off time. STAT orders shall be handled on a case-by-basis. Any STAT order must be verified and validated with the originating facility Point of Contact prior to being filled. The use of STAT orders is uncommon and is estimated to be rarely used, if ever.

13. TASK ORDER MANAGEMENT

13.1 A Task Order will be issued with a Not to Exceed Amount (NTE) for the period of performance. The contractor shall notify VA COR when 80% of the amount obligated has been expended. The Contractor shall not perform any requirements that exceed the obligated amount.

14. ADDITION OF THERAPIES

14.1 Due to the emergent nature of this requirement, the VA requests the ability to unilaterally add therapies/drugs to the contract as they are required, as long as the drug has a valid National Drug Code (NDC). If the vendor cannot accommodate the requested therapies, the VA requests that the vendor reach out to the administrating contracting officer, the requestor, and the VISN Point of Contact (POC) immediately to determine if alternative therapies could be performed.

15. DRUG AND SUPPLY PRICING ADJUSTMENTS

15.1 Due to the emergent nature of this requirement, the Government reserves the right to unilaterally adjust the pricing of any drugs identified on the price/cost schedule at the time of task order award. The adjustment will reflect the actual price based on the Average Wholesale Price (AWP) or catalog pricing on the date the order is placed, as communicated between the Contracting Officer and the Contractor. The Government will not unilaterally change any applicable fees identified in Rows 128–132. If the Government knows in advance the actual supply pricing for a particular order, it may unilaterally adjust the estimated price reflected in Row 133.

16. SUPPLY LIST AND INVOICING REQUIREMENTS

16.1 Within 30 days of award, the Contractor shall provide the CO and the VISN POC with a detailed supply list reflecting the applicable discount structure referenced in the price cost schedule (Cell G134). This list shall correspond to the estimated supply amounts and the estimated 70.00 dollar per order pricing identified in Row

133. The Government requires this list to validate the Contractor’s supply pricing under this CLIN and to ensure proper stewardship of taxpayer funds. The Contractor shall provide quarterly updates identifying any new items or pricing changes. If no changes have occurred, the Contractor shall notify the CO and VISN POC by email confirming that no updates to the supply price list have occurred.

16.2 The Contractor shall charge only for actual supplies used and shall itemize and definitize all supplies individually on each invoice. This includes a detailed breakdown of all supplies per order. If the actual supply cost for any order is expected to exceed 70.00 dollars, the Contractor shall contact the CO or VISN POC immediately and obtain approval prior to filling the order.

17. INVOICING AND PAYMENT

17.1 PAYMENT CONDITIONS:

17.1.1 RATES:

• Contractor will provide firm-fixed price rates for each designated period. No pass-through costs due to disposal, fuel, or host site increases will be passed on to the Government. All labor, equipment, management, disposal, shipping, or travel fees for this contract shall be included in the scheduled line-item cost provided to the Government.

17.2 INVOICES:

• Payment shall be made in arrears by way of a properly prepared detailed invoice validated by the site Point of Contact (POC).

• Each facility shall be invoiced individually via Purchase Order (PO) number.

• Invoices may be submitted individually or in batches as long as the performance has been approved and completed. Under no circumstances will the Government pre-pay for services rendered.

• Invoices must be sent electronically through the VA Tungsten Network Portal.

• All invoices shall be delivered to Tungsten Network.

• A properly prepared invoice shall contain:

o Invoice Number and Date services were provided.

o Contract Number.

o Contractor’s Name and Address.

o Accurate Purchase Order Number.

o CLIN & Date of service/period of supply.

o Description of Supply or Service provided, broken down by order with all components individually identified and priced including detailed supply use and applicable pricing. There shall not be one line item per order.

o Total amount due.

17.3 PAYMENTS:

• Payments will be made in arrears in accordance with FAR Clause 52.232-25, Prompt Payment Act.

Payments will be based on the rates established during the solicitation phase, provided the requirements listed are fully met. The contractor must include the contract number, purchase order number, period of service, or other distinguishable identifiers on each invoice.

18. SPECIFICATIONS BELOW FOR COMPATIBILITY NEEDS: Facility will define preferences and/or needs on the following items.

18.1 All hazardous compounded bags will be dispensed already spiked with infusion tubing primed with base fluid.

18.2 Manufacturer guidelines should be followed for specifications related to the need for in-line filters, low sorb tubing, and/or DEHP-free bags and tubing.

18.3 Refer to Facility Preference Document for specifics related to type of infusion tubing, closed system transfer device, total volume calculations, and Fluorouracil home infusion devices.

19. DELIVERY LOCATIONS:

VA Medical Center (VAMC) or facility Point of Contact Name, email address, and telephone number

Lieutenant Colonel Charles S. Kettles VAMC POC Information will be provided at time of contract award

2215 Fuller Rd Ann Arbor, MI 48105

Battle Creek VAMC 5500 Armstrong Rd

Battle Creek, MI 49037 POC Information will be provided at time of contract award

Chillicothe VAMC 17273 State Route 104 Chillicothe, OH 45601

POC Information will be provided at time of contract award

Cincinnati VAMC 3200 Vine St

Cincinnati, OH 45220 POC Information will be provided at time of contract award

Louis Stokes VAMC 10701 East Blvd

Cleveland, OH 44106 POC Information will be provided at time of contract award

Chalmers P. Wylie Outpatient Clinic 420 North James Rd Columbus, OH 43219

POC Information will be provided at time of contract award

Dayton VAMC 4100 West Third St Dayton, OH 45428

POC Information will be provided at time of contract award

John D. Dingell VAMC 4646 John R St

Detroit, MI 48201 POC Information will be provided at time of contract award

Richard L. Roudebush VAMC 1481 West 10th St

Indianapolis, IN 46202 POC Information will be provided at time of contract award

Northern Indiana Healthcare System Marion

1700 East 38th St Marion, IN 46953

Fort Wayne

2121 Lake Ave Fort Wayne, IN 46805

POC Information will be provided at time of contract award

Aleda E. Lutz VAMC 1500 Weiss St

Saginaw, MI 48602 POC Information will be provided at time of contract award

VISN 10

Pharmacy Benefits Management (119)

Not a compounding location

POC Information will be provided at time of contract award

20. WORK HOURS:

VA locations pharmacy can receive medications between 08:00 and 16:00 Monday-Friday. Special arrangements will be made for any deliveries that are needed on weekends and/or holidays.

21. CONTINGENCY PLANNING:

The Contractor shall have a contingency backup plan if compounding facility is affected by any certification discrepancies, equipment malfunctions, natural disasters, or other matters affecting performance of the contract. Contingency locations must be provided and meet the same criteria as stated herein.

22. CONTRACTOR QUALIFICATIONS:

Compounding must be done at an FDA 503A compliant facility and meet all applicable federal, state, and local laws. Compounding, labeling, and beyond use dating/expiration dating will be based on manufacturer labeling, USP 797, USP 800 and Federal Law.

23. COMPLIANCE WITH APPLICABLE LAWS AND REGULATIONS:

The Contractor shall ensure that services provided to the Government under this contract comply with all applicable federal and state laws, statutes, regulations, and guidelines. The Contractor shall also ensure that all services provided to the Government under this contract comply with all applicable Government mandated procedures, standards, and requirements.

24. QUALITY CONTROL AND QUALITY ASSURANCE FOR CONTRACT SERVICE:

The contractor shall be responsible for effective implementation of their Quality Control Program, and shall be responsive to the requirements of the Government’s Quality Assurance Plan conducted by the VISN Program POC and/or CO.

The contractor shall have a Quality Control program to assure that the requirements of the contract are provided as specified. One copy of the Contractor’s basic Quality Control Program shall be submitted for approval by the VISN Program POC and CO. Subsequent changes to the approved Quality Control Program must also be reviewed and approved by the VISN Program POC with final approval by the Contracting officer.

The program shall include but not be limited to the following.

An inspection system covering the performance indicators given in the Quality Assurance/Performance Requirements table below.

A method for identifying deficiencies in the quality of services performed before the level of performance becomes unacceptable.

A file of all quality control inspections inspection results, and any corrective action required shall be maintained by the Contractor throughout the duration of this contract. This file shall be the property of the Government and shall be available to the CO during normal working hours. The file shall be turned over to the Government within 14 days of completion of termination of the contract.

QASP: A (Quality Assurance Surveillance Plan (QASP) has been developed for in-house operations or to implement a service contract. It is designed to aid the Government in providing effective and systematic surveillance of all aspects of document and media destruction. This plan provides for monitoring all contract requirements through a combination of methods. These are:

a. Random observation

b. Client/Customer Complaints

c. Surveillance Activity Checklist

The QASP is a “living document” and the Government may review and revise it on a regular basis. However, the Government shall coordinate changes with the contractor. Updates shall ensure that the QASP remains a valid, useful, and enforceable document. Copies of the original QASP and revisions shall be provided to the contractor and Government officials implementing surveillance activities. The objective of this surveillance plan is to evaluate how the Government or contractor is performing in key areas.

25. QUALITY ASSURANCE/PERFORMANCE REQUIREMENTS: The Government will monitor the Contractor’s performance under this contract with performance objectives identified below:

Task # Indicator Standard Acceptable

Quality Level

Method of Surveillance Incentive

General

Orders processed accurately

Contractor shall ensure all orders are processed per prescription order

100% Labeling

Positive Past Performance &

Exercise of Option Period

Orders received prior to infusion date/time

Contractor shall comply with all safety requirements

100% Validated receipt of order

Positive Past Performance &

Exercise of Option Period

Contractor maintains certifications required for compounding

Contractor shall furnish copies of certificates and complete VHA

PBM

Assessment

Annually

100%

Validated receipt of certificates and/or assessment

Positive Past Performance &

Exercise of Option Period

Confirmation of Task Orders

Contractor shall confirm all task orders within 8 hours.

100%

Correspondence from Vendor

POC to station initiator

Positive Past Performance &

Exercise of Option Period

Updated

Supply Price List

Contractor shall provide updated supply list at the time of award and quarterly if no updates have been performed to the supply list.

100% Validated by CO and VISN POC

Positive Past Performance &

Exercise of Option Period

26. PERFORMANCE MONITORING:

The government will periodically evaluate the contractor's performance by appointing representative(s) from serviced facilities to monitor performance to ensure services are received.

The government representative will evaluate the contractor's performance through intermittent observation and on-site inspections of the contractor's quality control program and receipt of complaints from facility personnel.

Routine collections and container movements will be observed by a government representative at random intervals no less than once per month.

The government representative may perform on-site inspections of the contractor's facility(s) if deemed necessary.

The government may increase the number of quality control inspections if deemed appropriate because of repeated failures discovered during quality control inspections or because of repeated customer complaints.

The government will also receive and investigate complaints from various customers located on the installation.

The contractor shall be responsible for initially validating customer complaints. However, the government representative shall make final determination of the validity of customer complaint(s) in cases of disagreement with customer(s).

27. ACCEPTABLE PERFORMANCE:

The Government shall document positive performance. Any report may become a part of the supporting documentation for any contractual action.

28. UNACCEPTABLE PERFORMANCE:

When unacceptable performance occurs, the CO shall inform the contractor. This will normally be in writing unless circumstances necessitate verbal communication. In any case the CO shall document the discussion and place it in the COR file.

When the CO determines formal written communication is required, the CO shall prepare a Contract Discrepancy Report (CDR) and present it to the contractor's program manager.

The contractor shall acknowledge receipt of the CDR in writing. The CDR will specify if the contractor is required to prepare a corrective action plan to document how the contractor shall correct the unacceptable performance and avoid a recurrence. The CDR will also state how long the contractor has to present this corrective action plan to the CO after receiving the CDR. The Government shall review the contractor's corrective action plan to determine acceptability.

Any CDRs may become a part of the supporting documentation for any contractual action deemed necessary by the CO.

29. CONTRACTOR TRAINING REQUIREMENTS:

Completion of the VA Privacy and Information Security Awareness and Rules of Behavior (VA10176) will satisfy the annual privacy requirement for all employees and contractors. This course has automatically been assigned to all VA employees' training plans.

If employees have access to protected health information (PHI) or access to VA systems (e.g., CPRS, JLV, CAPRI, or VHIE) they are required to take the Privacy and HIPAA Focused training (VA10203), in addition to

(VA10176).

Options for taking the course include the web-based training or text version.

Privacy and HIPAA Focused Web-Based Training (VA10203) All individuals who have access to protected health information (PHI) in the performance of their official duties, including those whom have access to PHI in the VA systems; such as CPRS, VHIE, CAPRI, JLV, etc., are required to take the Privacy and HIPAA Focused training.

30. CONTRACTING WITH PARTIES LISTED ON THE OIG LIST OF EXCLUDED INDIVIDUALS/ENTITIES:

In accordance with Health Insurance Portability and Accountability Act (HIPAA) and the Balanced Budget Act (BBA) of 1977, the Office of Inspector General has established a list of parties and entities excluded from Federal health care programs. Specifically, the listed parties and entities may not receive Federal payments due to fraud and/or abuse of the Medicare and Medicaid programs. The list of excluded individuals/entities can be found on the Office of Inspector General (OIG) web site at www.hhs.gov/oig.

31. INFORMATION SECURITY OFFICER, INFORMATION PROTECTION:

The contractor will not have access to VA Desktop computers nor online resources belonging to the government while conducting services.

32. RECORDS MANAGEMENT:

The contractor will have access to protected Patient Health Information (PHI), but it will not have the capability of accessing patient information during the services provided to VHSO. The contractor will not have access to VA Desktop computers, nor will they have access to online resources belonging to the government while conducting services.

Citations to pertinent laws, codes, and regulations such as 44 United States Code (U.S.C) chapters 21, 29, 31 and 33; Freedom of Information Act (5 U.S.C. 552); Privacy Act (5 U.S.C. 552a); 36 Code of Federal Regulations (CFR) Part 1222 and Part 1228.

Contractor shall treat all deliverables under the contract as the property of the United States (U.S.)

Government for which the Government Agency shall have unlimited rights to use, dispose of, or disclose such data contained therein as it determines to be in the public interest.

Contractor shall not create or maintain any records that are not specifically tied to or authorized by the contract using Government information technology (IT) equipment and/or Government records.

Contractor shall not retain, use, sell, or disseminate copies of any deliverable that contains information covered by the Privacy Act of 1974 or that which is generally protected by the Freedom of Information Act.

Contractor shall not create or maintain any records containing any Government Agency records that are not specifically tied to or authorized by the contract.

The Government Agency owns the rights to all data/records produced as part of this contract.

33. CONTRACT SECURITY:

The contractor, their personnel, and their subcontractors shall be subject to the Federal laws, regulations, standards, and VA Directives and Handbooks regarding information and information system security as delineated in this contract.

Information made available to the contractor or subcontractor by VA for the performance or administration of this contract or information developed by the contractor/subcontractor in performance or administration of the contract shall be used only for those purposes and shall not be used in any other way without the prior written agreement of the VA. This clause expressly limits the contractor/subcontractor's rights to use data as described in Rights in Data - General, FAR 52.227-14(d) (1).

VA information should not be co-mingled, if possible, with any other data on the contractors/subcontractor’s information systems or media storage systems in order to ensure VA requirements related to data protection and media sanitization can be met. If co-mingling must be allowed to meet the requirements of the business need, the contractor must ensure that VA’s information is returned to the VA or destroyed in accordance with http://www.hhs.gov/oig

VA’s sanitization requirements. VA reserves the right to conduct onsite inspections of contractor and subcontractor IT resources to ensure data security controls, separation of data and job duties, and destruction/media sanitization procedures are in compliance with VA directive requirements.

Prior to termination or completion of this contract, contractor/subcontractor must not destroy information received from VA, or gathered/created by the contractor in the course of performing this contract without prior written approval by the VA. Any data destruction done on behalf of VA by a contractor/subcontractor must be done in accordance with National Archives and Records Administration (NARA) requirements as outlined in VA Directive 6300, Records and Information Management and its Handbook 6300.1 Records Management Procedures, applicable VA Records Control Schedules, and VA Handbook 6500.1, Electronic Media Sanitization. Self-certification by the contractor that the data destruction requirements above have been met must be sent to the VA Contracting Officer within 30 days of termination of the contract.

The contractor/subcontractor must receive, gather, store, back up, maintain, use, disclose and dispose of VA information only in compliance with the terms of the contract and applicable Federal and VA information confidentiality and security laws, regulations and policies. If Federal or VA information confidentiality and security laws, regulations and policies become applicable to the VA information or information systems after execution of the contract, or if NIST issues or updates applicable FIPS or Special Publications (SP) after execution of this contract, the parties agree to negotiate in good faith to implement the information confidentiality and security laws, regulations and policies in this contract.

The contractor/subcontractor shall not make copies of VA information except as authorized and necessary to perform the terms of the agreement or to preserve electronic information stored on contractor/subcontractor electronic storage media for restoration in case any electronic equipment or data used by the contractor/subcontractor needs to be restored to an operating state. If copies are made for restoration purposes, after the restoration is complete, the copies must be appropriately destroyed.

If VA determines that the contractor has violated any of the information confidentiality, privacy, and security provisions of the contract, it shall be sufficient grounds for VA to withhold payment to the contractor or third party or terminate the contract for default or terminate for cause under Federal Acquisition Regulation (FAR) part 12.

If a VHA contract is terminated for cause, the associated BAA must also be terminated and appropriate actions taken in accordance with VHA Handbook 1600.01, Business Associate Agreements. Absent an agreement to use or disclose protected health information, there is no business associate relationship.

The contractor/subcontractor must store, transport, or transmit VA sensitive information in an encrypted form, using VA-approved encryption tools that are, at a minimum, FIPS 140-2 validated.

The contractor/subcontractor’s firewall and Web services security controls, if applicable, shall meet or exceed VA’s minimum requirements. VA Configuration Guidelines are available upon request.

Except for uses and disclosures of VA information authorized by this contract for performance of the contract, the contractor/subcontractor may use and disclose VA information only in two other situations: (i) in response to a qualifying order of a court of competent jurisdiction, or (ii) with VA’s prior written approval. The contractor/subcontractor must refer all requests for, demands for production of, or inquiries about, VA information and information systems to the VA contracting officer for response.

Notwithstanding the provision above, the contractor/subcontractor shall not release VA records protected by Title 38 U.S.C. 5705, confidentiality of medical quality assurance records and/or Title 38 U.S.C. 7332, confidentiality of certain health records pertaining to drug addiction, sickle cell anemia, alcoholism or alcohol abuse, or infection with human immunodeficiency virus. If the contractor/subcontractor is in receipt of a court order or other requests for the above-mentioned information, that contractor/subcontractor shall immediately refer such court orders or other requests to the VA contracting officer for response.

For service that involves the storage, generating, transmitting, or exchanging of VA sensitive information but does not require C&A or an MOU-ISA for system interconnection, the contractor/subcontractor must complete a Contractor Security Control Assessment (CSCA) on a yearly basis and provide it to the COR.

34. SECURITY INCIDENT INVESTIGATION

a. The term “security incident” means an event that has, or could have, resulted in unauthorized access to, loss or damage to VA assets, or sensitive information, or an action that breaches VA security procedures. The contractor/subcontractor shall immediately notify the COTR and simultaneously, the designated ISO and Privacy Officer for the contract of any known or suspected security/privacy incidents, or any unauthorized disclosure of sensitive information, including that contained in system(s) to which the contractor/subcontractor has access.

b. To the extent known by the contractor/subcontractor, the contractor/subcontractor’s notice to VA shall identify the information involved, the circumstances surrounding the incident (including to whom, how, when, and where the VA information or assets were placed at risk or compromised), and any other information that the contractor/subcontractor considers relevant.

c. With respect to unsecured protected health information, the business associate is deemed to have discovered a data breach when the business associate knew or should have known of a breach of such information. Upon discovery, the business associate must notify the covered entity of the breach. Notifications need to be made in accordance with the executed business associate agreement.

d. In instances of theft or break-in or other criminal activity, the contractor/subcontractor must concurrently report the incident to the appropriate law enforcement entity (or entities) of jurisdiction, including the VA OIG and Security and Law Enforcement. The contractor, its employees, and its subcontractors and their employees shall cooperate with VA and any law enforcement authority responsible for the investigation and prosecution of any possible criminal law or violation(s) associated with any incident. The contractor/subcontractor shall cooperate with VA in any civil litigation to recover VA information, obtain monetary or other compensation from a third party for damages arising from any incident, or obtain injunctive relief against any third party arising from, or related to, the incident.

35. LIQUIDATED DAMAGES FOR DATA BREACH

a. Consistent with the requirements of 38 U.S.C. §5725, a contract may require access to sensitive personal information. If so, the contractor is liable to VA for liquidated damages in the event of a data breach or privacy incident involving any SPI the contractor/subcontractor processes or maintains under this contract.

b. The contractor/subcontractor shall provide notice to VA of a “security incident” as set forth in the Security Incident Investigation section above. Upon such notification, VA must secure from a non-Department entity or the VA Office of Inspector General an independent risk analysis of the data breach to determine the level of risk associated with the data breach for the potential misuse of any sensitive personal information involved in the data breach. The term 'data breach' means the loss, theft, or other unauthorized access, or any access other than that incidental to the scope of employment, to data containing sensitive personal information, in electronic or printed form, that results in the potential compromise of the confidentiality or integrity of the data.

Contractor shall fully cooperate with the entity performing the risk analysis. Failure to cooperate may be deemed a material breach and grounds for contract termination.

c. Each risk analysis shall address all relevant information concerning the data breach, including the following:

(1) Nature of the event (loss, theft, unauthorized access);

(2) Description of the event, including:

(a) date of occurrence;

(b) data elements involved, including any PII, such as full name, social security number, date of birth, home address, account number, disability code;

(3) Number of individuals affected or potentially affected;

(4) Names of individuals or groups affected or potentially affected;

(5) Ease of logical data access to the lost, stolen or improperly accessed data in light of the degree of protection for the data, e.g., unencrypted, plain text

(6) Amount of time the data has been out of VA control;

(7) The likelihood that the sensitive personal information will or has been compromised (made accessible to and usable by unauthorized persons);

(8) Known misuses of data containing sensitive personal information, if any;

(9) Assessment of the potential harm to the affected individuals;

(10) Data breach analysis as outlined in 6500.2 Handbook, Management of Security and Privacy Incidents, as appropriate; and

(11) Whether credit protection services may assist record subjects in avoiding or mitigating the results of identity theft based on the sensitive personal information that may have been compromised.

d. Based on the determinations of the independent risk analysis, the contractor shall be responsible for paying to the VA liquidated damages in the amount of $37.50 per affected individual to cover the cost of providing credit protection services to affected individuals consisting of the following:

(1) Notification;

(2) One year of credit monitoring services consisting of automatic daily monitoring of at least 3 relevant credit bureau reports;

(3) Data breach analysis

(4) Fraud resolution services, including writing dispute letters, initiating fraud alerts and credit freezes, to assist affected individuals to bring matters to resolution;

(5) One year of identity theft insurance with $20,000.00 coverage at $0 deductible; and

(6) Necessary legal expenses the subjects may incur to repair falsified or damaged credit records, histories, or financial affairs.

VA 6500 APPENDIX C VA INFORMATION AND INFORMATION SYSTEM SECURITY AND PRIVACY

LANGUAGE

1. GENERAL. This entire section applies to all acquisitions requiring any Information Security and Privacy language. Contractors, contractor personnel, subcontractors and subcontractor personnel will be subject to the same federal laws, regulations, standards, VA directives and handbooks, as VA personnel regarding information and information system security and privacy.

2. VA INFORMATION CUSTODIAL LANGUAGE. This entire section applies to all acquisitions requiring any Information Security and Privacy language.

a. The Government shall receive unlimited rights to data/intellectual property first produced and delivered in the performance of this contract or order (hereinafter “contract”) unless expressly stated otherwise in this contract. This includes all rights to source code and all documentation created in support thereof. The primary clause used to define Government and Contractor data rights is FAR 52.227-14 Rights in Data – General. The primary clause used to define computer software license (not data/intellectual property first produced under this contractor or order) is FAR 52.227-19, Commercial Computer Software License.

b. Information made available to the contractor by VA for the performance or administration of this contract will be used only for the purposes specified in the service agreement, SOW, PWS, PD, and/or contract.

The contractor shall not use VA information in any other manner without prior written approval from a VA Contracting Officer (CO). The primary clause used to define Government and Contractor data rights is FAR 52.227-14 Rights in Data – General.

c. VA information will not be co-mingled with any other data on the contractor’s information systems or media storage systems. The contractor shall ensure compliance with Federal and VA requirements related to data protection, data encryption, physical data segregation, logical data segregation, classification requirements and media sanitization.

d. VA reserves the right to conduct scheduled or unscheduled audits, assessments, or investigations of contractor Information Technology (IT) resources to ensure information security is compliant with Federal and VA requirements. The contractor shall provide all necessary access to records (including electronic and documentary materials related to the contracts and subcontracts) and support (including access to contractor and subcontractor staff associated with the contract) to VA, VA's Office Inspector General (OIG), and/or Government Accountability Office (GAO) staff during periodic control assessments, audits, or investigations.

e. The contractor may only use VA information within the terms of the contract and applicable Federal law, regulations, and VA policies. If new Federal information security laws, regulations or VA policies become applicable after execution of the contract, the parties agree to negotiate contract modification and adjustment necessary to implement the new laws, regulations, and/or policies.

f. The contractor shall not make copies of VA information except as specifically authorized and necessary to perform the terms of the contract. If copies are made for restoration purposes, after the restoration is complete, the copies shall be destroyed in accordance with VA Directive 6500, VA Cybersecurity Program and VA Information Security Knowledge Service.

g. If a Veterans Health Administration (VHA) contract is terminated for default or cause with a business associate, the related local Business Associate Agreement (BAA) shall also be terminated and actions taken in accordance with VHA Directive 1605.05, Business Associate Agreements. If there is an executed national BAA associated with the contract, VA will determine what actions are appropriate and notify the contactor.

h. The contractor shall store and transmit VA sensitive information in an encrypted form, using VA-approved encryption tools which are, at a minimum, Federal Information Processing Standards (FIPS) 140-2, Security Requirements for Cryptographic Modules (or its successor) validated and in conformance with VA Information Security Knowledge Service requirements. The contractor shall transmit VA sensitive information using VA approved Transport Layer Security (TLS) configured with FIPS based cipher suites in conformance with National Institute of Standards and Technology (NIST) 800-52, Guidelines for the Selection, Configuration and Use of Transport Layer Security (TLS) Implementations.

i. The contractor’s firewall and web services security controls, as applicable, shall meet or exceed VA’s minimum requirements.

j. Except for uses and disclosures of VA information authorized by this contract for performance of the contract, the contractor may use and disclose VA information only in two situations: (i) in response to a qualifying order of a court of competent jurisdiction after notification to VA CO (ii) with written approval from the VA CO. The contractor shall refer all requests for, demands for production of or inquiries about, VA information and information systems to the VA CO for response.

k. Notwithstanding the provision above, the contractor shall not release VA records protected by Title 38 U.S.C. § 5705, Confidentiality of medical quality-assurance records and/or Title 38 U.S.C. § 7332, Confidentiality of certain medical records pertaining to drug addiction, sickle cell anemia, alcoholism or alcohol abuse or infection with Human Immunodeficiency Virus (HIV). If the contractor is in receipt of a court order or other requests for the above-mentioned information, the contractor shall immediately refer such court order or other requests to the VA CO for response.

l. Information made available to the contractor by VA for the performance or administration of this contract or information developed by the contractor in performance or administration of the contract will be protected and secured in accordance with VA Directive 6500 and Identity and Access Management (IAM) Security processes specified in the VA Information Security Knowledge Service.

m. Any data destruction done on behalf of VA by a contractor shall be done in accordance with National Archives and Records Administration (NARA) requirements as outlined in VA Directive 6300, Records and Information Management, VA Handbook 6300.1, Records Management Procedures, and applicable VA Records Control Schedules.

n. The contractor shall provide its plan for destruction of all VA data in its possession according to VA Directive 6500 and NIST 800-88, Guidelines for Media Sanitization prior to termination or completion of this contract. If directed by the COR/CO, the contractor shall return all Federal Records to VA for disposition.

o. Any media, such as paper, magnetic tape, magnetic disks, solid state devices or optical discs that is used to store, process, or access VA information that cannot be destroyed shall be returned to VA.

The contractor shall hold the appropriate material until otherwise directed by the Contracting Officer’s Representative (COR) or CO. Items shall be returned securely via VA-approved methods. VA sensitive information must be transmitted utilizing VA-approved encryption tools which are validated under FIPS 140-2 (or its successor) and NIST 800-52. If mailed, the contractor shall send via a trackable method (USPS, UPS, FedEx, etc.) and immediately provide the COR/CO with the tracking information. Self-certification by the contractor that the data destruction requirements above have been met shall be sent to the COR/CO within 30 business days of termination of the contract.

p. All electronic storage media (hard drives, optical disks, CDs, back-up tapes, etc.) used to store, process or access VA information will not be returned to the contractor at the end of lease, loan, or trade-in.

Exceptions to this paragraph will only be granted with the written approval of the VA CO.

3. ACCESS TO VA INFORMATION AND VA INFORMATION SYSTEMS. This section applies when any person requires access to information made available to the contractor by VA for the performance or administration of this contract or information developed by the contractor in performance or administration of the contract.

a. A contractor/subcontractor shall request logical (technical) or physical access to VA information and VA information systems for their employees and subcontractors only to the extent necessary to perform the services specified in the solicitation or contract. This includes indirect entities, both affiliate of contractor/subcontractor and agent of contractor/subcontractor.

b. Contractors and subcontractors shall sign the VA Information Security Rule of Behavior (ROB) before access is provided to VA information and information systems (see Section 4, Training, below). The ROB contains the minimum user compliance requirements and does not supersede any policies of VA facilities or other agency components which provide higher levels of protection to VA’s information or information systems. Users who require privileged access shall complete the VA elevated privilege access request processes before privileged access is granted.

c. All contractors and subcontractors working with VA information are subject to the same security investigative and clearance requirements as those of VA appointees or employees who have access to the same types of information. The level and process of background security investigations for contractors shall be in accordance with VA Directive and Handbook 0710, Personnel Suitability and Security Program.