36C261-26-AP-0266-FY26-1539 JOFOC NCO21 VASNHCS Olympus - HCA Approved _Redacted.pdf

VHAPG Part 808.405-6 Limiting Sources Page 1 of 6 Revision: 01 Effective Date: 09/01/2024 Acquisition ID#: 36C261-26-AP-0266

LIMITED SOURCES JUSTIFICATION

ORDER >SAT

FAR PART 8.405-6

Acquisition Plan Action ID: 36C261-26-AP-0266 JOFOC Log Number: FY26-NCO-21-219

(1) Contracting Activity: Department of Veterans Affairs (VA), Regional Procurement Office West (RPOW), Network Contracting Office (NCO) 21, on behalf of the Veterans Integrated Service Networks (VISN) 21 VA Southern Nevada Health Care System (VASNHCS).

PR 2237: 593-26-1-405-0001, 593-26-1-405-0014

(2) Description of Action: This acquisition is conducted under the authority of the Multiple- Award Schedule Program (41 U.S.C. 152(3) and 40 U.S.C. 501). The action being reviewed and approved is a new requirement for a sole source delivery order with Olympus America, Inc.

(Olympus) a Large Business.

Order against: FSS Contract Number: 36F79721D0168

Name of Proposed Contractor: Olympus America, Inc.

Street Address: 3500 Corporate Pkwy

City, State, Zip: Center Valley, PA 18034-8229

Phone: 858-539-9102

(3) Description of Supplies or Services:

The estimated total value of the proposed action is $2,473,943.34 one-year base period with two (2) one-year option periods.

The period of performance would be:

Base Year 02/01/2026 – 01/31/2027 $824,647.78

Option Year 1 02/01/2027 – 01/31/2028 $824,647.78 Option Year 2 02/01/2028 – 01/31/2029 $824,647.78

This procurement is for a firm-fixed price delivery order for the continued lease and maintenance for an entire suite of various Olympus flexible endoscopes. The Olympus endoscopes are already being leased and maintained for the Gastrointestinal, Pulmonary, Ear, Nose, and Throat doctors at VASNHCS. These endoscopes are essential for diagnostic and

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Acquisition ID#: 36C261-26-AP-0266 therapeutic procedures and must remain compatible with existing Olympus imaging processors, software, and network infrastructure. FAR clause 52.217-8, Option to Extend Services will be used if needed to ensure there is no interruption in services to Veterans.

The current contract (36C26121P0048) lease expires on 11/30/2025 and a need to put in a new long-term contract is requested to prevent the disruption in Veteran care throughout several services.

Items to be leased are identified below:

Equipment Listing

Quantity Type Model Equipment Description Four (4) New OTV-S500 OTV-S500 W/POWER CORD (US) Two (2) New MAJ-2547 MAJ-2547 UPGRADE PACK STROBE OTVS500(US) Four (4) New MAJ-2548 MAJ-2548 AIR MICROPHONE Four (4) New MAJ-2550 MAJ-2550 MICROPHONE EXTENSION CABLE Two (2) New MAJ-2549 MAJ-2549 THROAT MICROPHONE OTV-S500 Six (6) New CH-S200-XZ-EA CH-S200-XZ-EA-U CH with 3CMOS Autoclavable

Ten (10) New ENF-VH ENF-VH Flexible video HD Rhino Laryngo S One (1) New ENF-V3 ENF-V3 Flexible ultra thin video Rhino L Two (2) New ENF-VT3 Video Therapeutic Rhinolaryngoscope Ten (10) New WA03300A Light-guide cable, 2.8 mm, 3 m, CF type Four (4) New ISM-1007451 15" NCARE MEDICAL GRADE TOUCH PANEL Four (4) New K10030136 TC-C3 TROLLEY SET 3 US/CA Four (4) New MAJ-2145 MAJ-2145 ENT SCOPE HANGER Four (4) New MAJ-2148 MAJ-2148 REAR PANEL Four (4) New MAJ-2167 MAJ-2167 NURSES CONTROL ARM Four (4) New ISM-1200389 nCare 4K and Accessories Four (4) New ISM-1200413 nCare 4K Base Software License Four (4) New ISM-1200414 nCare 4K Video Recording in HD Four (4) New ISM-1200415 nCare 4K 2nd Channel Four (4) New OEV321UH OEV321UH UHD 4K 32-inch Monitor

(4) Identify the Authority and Supporting Rationale (see below and if applicable, a demonstration of the proposed contractor’s unique qualifications to provide the required supply or service).

FAR 8.405-6(a)(1)(A): An urgent and compelling need exists and following the ordering procedures would result in unacceptable delays:

FAR 8.405-6(a)(1)(B): Only one source is capable of providing the supplies or services required at the level of quality required because the supplies or services are unique or highly specialized.

The endoscopes are highly sophisticated flexible instruments that are inserted through the orifices such as the mouth and rectum into different parts of the digestive tract. These instruments help to visualize and diagnose intestinal disorders, to obtain biopsies, to place stents, to remove tumors and curb internal hemorrhage. The endoscopes are connected to a

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Acquisition ID#: 36C261-26-AP-0266 very high intensity light source and a video processing unit. The flexible endoscope that is inserted into the Veteran has an embedded high density video camera that transmits a video image, and a fiber-optic light bundle to transmit the light from the light source into the innards of the Veteran. The video is obtained with the help of the light source and is processed and stored by the video processing unit.

VASNHCS has standardized Olympus endoscopy systems since 2020 for all Gastrointestinal, Ear, Nose, and Throat, Endoscopy, and Pulmonary departments. The infrastructure, including processors, software, and integration components—are proprietary to Olympus and not interoperable with other manufacturers.

Olympus is the Original Equipment Manufacturer (OEM) and is the sole entity authorized to lease and maintain Olympus endoscopy systems for the U.S. Government.

Olympus endoscopes are preferred by clinicians due to image quality, ergonomics, and extensive staff familiarity, which directly affect Veteran safety and diagnostic accuracy.

Replacing the current endoscopes with another manufacturer would require:

- Complete replacement of existing Olympus processors, towers, and peripherals.

- Reinstallation of image management software and network integration.

- Retraining of all clinical and biomedical engineering staff.

- Extended system downtime (estimated 2–4 months).

- Write-off of existing leased and owned Olympus inventory.

Accordingly, Olympus is the only firm capable of providing the supplies and services described in Section 3 above without the Veterans Health Administration experiencing substantial duplication of cost that could not be expected to be recovered through competition.

FAR 8.405-6(a)(1)(C): In the interest of economy and efficiency, the new work is a logical follow-on to an original Federal Supply Schedule order provided that the original order was placed in accordance with the applicable Federal Supply Schedule ordering procedures. The original order must not have been previously issued under sole source or limited source procedures.

FAR 8.405-6(b): Items peculiar to one manufacturer:

A patent, copyright or proprietary data limits competition. The proprietary data is:

These are “direct replacements” parts/components for existing equipment.

The material/service must be compatible in all aspects (form, fit and function) with existing systems presently installed/performing.

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Acquisition ID#: 36C261-26-AP-0266

(5) Describe Why You Believe the Order Represents the Best Value consistent with FAR 8.404(d) to aid the contracting officer in making this best value determination:

By placing an order against a schedule contract, the ordering activity has concluded that the order represents the best value. Although General Services Administration has already negotiated fair and reasonable pricing, the CO will seek an additional discount before awarding the order. The monthly preventive maintenance service rate provided by Olympus is at a fixed price.

(6) Describe the Market Research Conducted among schedule holders and the results or a statement of the reason market research was not conducted.

A Notice of Intent to Sole Source was posted on Contracting Opportunities (36C26126Q0047) from 9/19/2025 to 09/29/2025. One vendor, L1 Enterprises Inc, a Service-Disabled Veteran- Owned Business responded that they have the capabilities to meet all the requirements. L1 Enterprises offers Karl Storz endoscopes which are similar to Gastroenterology and Ear, Nose, and Throat systems; however, they are not compatible with Olympus processors or accessories, and conversion would require replacement of all Olympus towers, processors, and image capture systems. It will take two to four months of installation and downtime and additional costs for staff retraining and software integration.

A search of the supply chain master catalog did not yield any results for Gastroenterology, Ear, Nose, and Throat, and Pulmonary endoscopes leases. A search of the General Services Administration Advantage yielded contract number 36F79721D0168, awarded to Olympus for the lease, maintenance and warranty of Olympus Gastroenterology, Endoscopy, Ear, Nose, and Throat and Pulmonary endoscopy scopes.

Reviewed the market research for the current contract 36C26121P0048 for the VASNHCS and the current contract 36C26125N0029 for the VA Central California Health Care System. Both contracts for endoscope requirements were sole sourced to Olympus.

A review of Contracting Opportunities for similar procurements revealed sources sought notices 36C24824Q1570, 36C26323Q1174, 36C26124Q0467, and 36C24523Q0977. These procurements were ultimately awarded under sole source conditions to Olympus.

The Small Business Administration’s (SBA) Small Business Search (SBS) database was utilized to identify certified, capable Service-Disabled Veteran-Owned Small Businesses (SDVOSBs) and Veteran-Owned Small Businesses (VOSBs). The search was conducted using the North American Industry Classification System (NAICS) code 339112, which refers to Surgical and Medical Instrument Manufacturing. The search yielded two (2) matches for SDVOSBs and VOSBs.

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Acquisition ID#: 36C261-26-AP-0266

(7) Any Other Facts Supporting the Justification: Olympus America Inc. has been providing satisfactory performance on the current contract with NCO 21.

(8) A Statement of the Actions, if any, the agency may take to remove or overcome any barriers that led to the restricted consideration before any subsequent acquisition for the supplies or services is made:

Future competition will be considered when the current Olympus endoscopes approaches the end of its life cycle, or when interoperability standards allow other OEMs to offer compatible, functionally equivalent systems that meet VA requirements without disrupting Veteran care.

(9) 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. I understand that processing of this limited sources justification restricts consideration of Federal Supply Schedule contractors to fewer than the number required by FAR Subpart 8.4.

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Acquisition ID#: 36C261-26-AP-0266

(10) Approvals in accordance with the VHAPM Part 806.3 OFOC SOP:

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

b. One Level Above the Contracting Officer (Required over the SAT but not exceeding $900K):

I certify the justification meets requirements for other than full and open competition.

HIGHER LEVEL APPROVAL (Required for orders over $900,000):

c. VHA RPO HCA Review and Approval (over $900,000 to $75 million): I have reviewed the foregoing justification and find it to be complete and accurate to the best of my knowledge and belief and approve for restricting consideration of the Federal Supply Schedule contractors to fewer than the number required by FAR Subpart 8.4.