FAR 13.5 Sole Source Justification - 36C24223P0029.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

36C242-22-AP-3035

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

Acquisition Plan Action ID: 36C242-22-AP-3035

1. Contracting Activity: Department of Veterans Affairs, Veterans Health Administration, Network Contracting Office 02 located at 2875 Union Road, Suite 3500, Buffalo, NY 14227, in support of the VISN 02 Facilities below:

VA Western New York Healthcare System VAMC Buffalo 3495 Bailey Ave Buffalo, NY 14215

VAMC Batavia 222 Richmond Ave Batavia, NY 14020

VAMC Albany 113 Holland Ave Albany, NY 12208

VA Finger Lakes Healthcare System VAMC Bath 76 Veterans Ave Bath, NY 14810

VAMC Canandaigua 400 Fort Hill Ave Canandaigua, NY 14424

VAMC Rochester OP Clinic 465 Westfall Rd Rochester, NY 14620

VAMC Syracuse 800 Irving Ave Syracuse, NY 132

2. Nature and/or Description of the Action Being Processed: This procurement is for a new sole source contract to provide continued use of an existing Philips’s Picture Archiving and Communication System (PACS) in accordance with FAR 13.5 Simplified Procedures for Certain Commercial Items and specifically FAR 13.501 Special Documentation Requirements, where acquisitions conducted under Simplified Acquisition Procedures are exempt from the requirements of FAR Part 6, but still require a justification using the format of FAR 6.303-2

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The Philips PACS is used by the Radiology Departments at the VA Medical Centers identified herein.

Continued service of the existing PACS is needed while the replacement PACS is implemented. This action is necessary to ensure uninterrupted access to this critical system. The VA National Acquisition Center (NAC) has awarded a long-term replacement of this system; however, the transition to the new competitor’s system is not expected to be completed for about two years.

3. Description of Supplies/Services Required to Meet the Agency’s Needs: The anticipated award action will have a period of performance from 10/01/2022 to 09/30/2023. Funds are available on 528-23-1-3761-0003. The total estimated value is $502,852.24.

This requirement is for the VISN 02 Medical Centers identified above to continue service of their current FDA approved PACS system which is used to electronically store medical images from modalities in Radiology/Imaging and to transmit images to diagnostic and clinical review workstations. Currently, VISN 2 has their radiology images in a Philips proprietary archive.

Continuation of this service is critical and required to ensure patient care is uninterrupted.

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):

The proposed awardee is PHILIPS HEALTHCARE INFORMATICS, INC., 4430 Rosewood DR STE 200 Pleasanton, CA 94588 (UEI: DVANZQLYKZQ9).

Philips Healthcare Informatics is the current PACS provider for VISN 2. Philips stores image data in a proprietary DTS compression format, along with annotations and markups placed by Radiologists when the images were interpreted. No other vendor can access this database of stored medical images in a seamless and timely fashion. Abrupt cessation of services would be detrimental to patient care from a quality, safety, time and cost standpoint. A replacement PACS has been awarded for VISN 2 and the transition process from the Philips PACS to the new system is underway. The transition of images from the current proprietary format into a vendor neutral archive is a complex, time consuming process that will take up to two years to complete. During this transition period it is necessary to maintain a contract with the current vendor to ensure the integrity and safe conversion of the data. Only Philips can maintain the functionality of the current PACS solution while the data is

36C242-22-AP-3035

Effective Date: 02/01/2022 Page 3 of 4 migrated to a vendor neutral archive. Philips will not need to install or replace any hardware to provide continued service under this agreement. Maintaining the Philips system is the only option to continue clinical operations during this transition period. a new system is already in place and the migration process is underway.

Description of Efforts Made to ensure that offers are solicited from as many potential sources as deemed practicable: A public notice of the VA’s intent to negotiate with a sole source (36C24222Q1258) was posted to SAM.gov on 09-20-2022. 36C24222Q1258 included a description of the requirement and invited any and all interested parties who believed they were capable of providing the services to respond to the notice. There were no responses to this notice received.

Additionally, as described above the replacement system has already been awarded by the VA NAC and competitive procedures were utilized.

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

Philips is offering continued use of this system at per study. The offered price is less than the per study previously paid on 36C24220P0054 and per study on 36C24219F0015. A fair and reasonable price determination will be based in part on a comparison of these prices which have previously been determined to be fair and reasonable.

Description of the Market Research Conducted and the Results, or a Statement of the Reasons Market Research Was Not Conducted: Market research was conducted using VetBiz, SBA’s DSBS and GSA searches, as well as reviewing past procurements for this service. No alternative sources were found.

Based on the results of the market research, it has been determined that using other than Philips during this transition period would require an entirely new PACS solution with an implementation period of over a year and would therefore not meet the current need. In addition to the time commitment required, there are significant implementation costs that would be duplicated. The need for an all new PACS solution has been met through competitive means and is in the process of being implemented.

As described in Section 6 above, market research, in accordance with FAR Part 10, was conducted by synopsis of the intent to solicit a single source, advising industry of the pending acquisition and soliciting inquiries from interested parties.

Any Other Facts Supporting the Use of Other than Full and Open Competition: None

Listing of Sources that Expressed, in Writing, an Interest in the Acquisition: None

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: Barriers to competition exist for procurements of this sort are essentially unavoidable. Procurements for

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Effective Date: 02/01/2022 Page 4 of 4 new PACS can be conducted competitively, but due to proprietary or incompatible image formats, only the current PACS provider can meet this need.

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.

Name: Alan X. Liu Title: Chief, Biomedical Engineering

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.

Joseph Cellino Contracting Officer Network Contracting Office 02

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.

Cheryl Brimmer Branch Chief Services Team 1 Network Contracting Office 02

ALAN LIU

Digitally signed by ALAN

LIU

Date: 2022.09.27 15:46:39 -04'00'

Joseph R.

Cellino 391287

Digitally signed by Joseph R. Cellino 391287 Date: 2022.09.27 15:59:39 -04'00'

Cheryl M Brimmer 113171

Digitally signed by Cheryl M Brimmer 113171 Date: 2022.09.27 16:23:41 -04'00'