ITB171021 Bidder Questions and Responses.doc

SPECIAL SUPPLEMENTAL NUTRITION PROGRAM

FOR WOMEN, INFANTS, AND CHILDREN (WIC PROGRAM)

ITB # ITB171021

COMMBUYS Bid# BD-16-1031-BFHN0-BFH01-00000007021

INVITATION TO BID

FOR

NEW ENGLAND AND TRIBAL organizations (NEATO)

WIC RETAIL INFANT FORMULA REBATE AGREEMENT

Cherokee Nation

Connecticut

Maine

Massachusetts

New Hampshire

Rhode Island

Seneca Nation

Bidder Questions and Responses

Bid Due: Wednesday, April 20, 2016; 10:00 AM ET

TENTATIVE TIME TABLE

EVENT

DEADLINE

ITB Release Date:

Friday, February 5, 2016

Bidder Questions Due:

Tuesday, February 23, 2016, 11:00 AM ET

Response to Bidder Questions:

Friday, March 25, 2016

Bids Due:

Wednesday, April 20, 2016, 10:00 AM ET

Bids Opened:

Wednesday, April 20, 2016, 11:00 AM ET

Tentative Contract Award Notification:

Wednesday, May 4, 2016

Agreement Start Date:

Saturday, October 1, 2016

TABLE OF CONTENTS

QUESTION & RESPONSE ATTACHMENTS:

(7 documents)

(7 documents)

(8 documents)

(1 document)

I. Gerber/Nestle Questions

1. Page 5 of 16, Section I.A. – How much state funding has been provided by Massachusetts in each of the last two years? Is the state funding intended to simply supplement federal funding, or is it used for a specific purpose?

It is a state option to supplement federal WIC funds. Massachusetts WIC must serve at least 85% of the eligible population as mandated by the Massachusetts Childhood Hunger Relief Act. Approximately 13% of total WIC funds were state funds in FY15 and FY16, respectively.

2. Page 5 of 16, Section I.A. – Please describe the process in New Hampshire for processing WIC food instruments. Is there a reason NH does not use the banking system?

The New Hampshire in-house payment is substantially similar to banking systems except that food instruments are batch invoiced directly to the State Agency. Claims processors within the New Hampshire State Agency perform system-based pre-payment edits for redemption date and price information on each submitted food instrument. The system also edits for stores that have restricted vouchers that do not allow infant formula purchases. Vouchers that fail these edits are rejected and final invoice totals are reconciled to the original invoice less any adjustments. The invoice information is then authorized and electronically transmitted through the New Hampshire Integrated Financial System to the State Treasury for payment. All redemption and editing results are maintained on the State Agency’s WIC MIS for purposes of federal reporting, including infant formula rebate tracking & billing.

3. Page 5, Section 1.A. – EBT – We have the following questions related to the transition to EBT systems:

a. For Seneca Nation, Connecticut, Maine, New Hampshire, and Rhode Island, please provide an estimated date to begin piloting an EBT system (month or quarter and year).

Seneca Nation: 2020;

Connecticut: Pilot began February 2016;

Maine: Not yet determined;

New Hampshire: April 2017; and Rhode Island: 2018.

b. Please also provide an estimated date for fully transitioning to EBT for each of the above State Agencies.

Seneca Nation: 2020;

Connecticut: June 2016;

Maine: Not yet determined;

New Hampshire: August/September 2017; and Rhode Island: 2019.

c. If any of the above State Agencies has developed an EBT implementation map (by geographic region or county), would the SA please provide a copy to prospective bidders.

None have been developed.

d. For each State Agency, please indicate whether the transition to EBT is expected to change the current mix of authorized retailers (i.e., fewer smaller retailers and more large retailers).

Seneca Nation and Rhode Island expect no change.

Connecticut and New Hampshire expect a slight reduction in smaller stores. Maine is unknown at this time.

e. For each State Agency, please indicate whether some currently authorized retailers will no longer be able to meet the requirements for WIC authorization.

Seneca Nation, Connecticut, and Rhode Island expect no issues.

Maine and New Hampshire are unknown at this time.

f. For Massachusetts and Seneca Nation, did the transition to EBT result in a change of the mix of authorized vendors? Did some of the authorized vendors lose their authorization status? If yes, approximately how many (percent)?

The mix did not change. Massachusetts lost approximately 7% of vendors and the Cherokee Nation lost approximately 11% of vendors.

4. Page 6 of 16, Section I.A. – Participation – Has participation in each State Agency been declining in recent years? If Yes, is there a reason for the declining participation? Do each of the State Agencies expect participation to continue to decline over the next 1-3 years?

Participation has been declining nationally. Multiple factors have been attributed to this decline, including but not limited to, lower birth rate and the improving economy. NEATO cannot make any assurances, promises, or guarantees as to the number of participants expected during the life of any Agreement.

5. Page 6 of 16, Section I.A. – Participation – We have the following additional questions:

a. For each State Agency, what percentage of participants have incomes that exceed 185% of the federal poverty level?

b. For each State Agency, what percentage of infants are certified for participation in the program through their participation in other federal programs (i.e., SNAP, TANF or Medicaid)?

This information is not pertinent to this ITB.

6. Page 7 of 16, Section II.A.1. – This section states written answers to questions will be posted March 25, 2016, which in some states is a holiday – Good Friday. Please confirm this is not a State holiday in Massachusetts and answers will be posted on this day.

Confirmed. NEATO’s written answers will be posted on COMMBUYS by Friday, March 25, 2016.

7. Page 7 of 16, Section II.A.2. – We have the following questions about the bid opening:

a. Would Massachusetts be willing to provide a call-in number for those bidders unable to attend the bid opening in person?

Yes. Information will be provided to the bidder contacts before the bid opening.

b. We request MA agree to read aloud the Total Net Cost for each of the three forms of infant formula, and the Total Net Cost Per Month on page 2 of the Bid Sheet.

As stated in the ITB, Section II.A.3, page 1 of the Bid Sheet will be read aloud. No other information shall be given.

8. Page 8 of 16, Section II.B.6. – We request NEATO consider eliminating the requirement that original bids and duplicate copies be sent to All States by the bid due date and time. This requirement creates significant logistical issues for all bidders and increases the potential for some bidders to be excluded from consideration if there are problems associated with the timely delivery of bids to all required locations. Multiple bid documents, many of which would likely have to be delivered in advance of the actual due date, also presents potential issues related to the integrity of the bid process. Bidders will only be able to witness the bid opening at one location. We request NEATO consider requiring all bidders to send copies of the bids (or an original and copy) to the other six State agencies the day after bids are publicly opened in Massachusetts.

The requirement will stand. NEATO has used this method numerous times without incident. The Commonwealth of Massachusetts is administering the ITB and Agreement, only they will receive an original bid. Copies of the bids will be locked and secured by each respective state and tribe representative until the official bid opening. Potential bidders can confirm with each state and tribe through email or phone that the bid was received and will remain secured until the bid opening. Please refer to ITB Attachment 3: Evaluation Criteria, Technical Requirements Nos. 1 and 2.

All bids must be submitted to the Commonwealth of Massachusetts on time to be part of the bid opening, no exceptions. See ITB Section II.B.2. However, for the other four states and two tribes, as long as the bidder is able to prove (documented proof) that arrival was scheduled prior to the time it is due, and the package is delayed, through no fault of the bidder, the bid will not be disqualified for this technicality.

9. Page 10 of 16, Section II.C.1.d. – Page 9, Section C.3. – We have the following questions related to the requirements for the formulas provided to NEATO WIC participations:

a. Please confirm infant formulas offering only 19 kilocalories per fluid ounce of formula at standard dilution do not meet the minimum requirements of the WIC Program and therefore are not eligible to be the primary contract infant formula for the State Agencies’ WIC Programs.

b. Please further confirm bidders offering only 19 kilocalorie formulas may not submit bids for this WIC Rebate solicitation.

c. Is it permissible under the terms of the contract resulting from this ITB for a Manufacturer to replace the primary contract formula with a product that does not meet the WIC minimum infant formula requirements per Table 4 of USDA’s regulations (see 246.10(d)(12))? If yes, please explain how that conforms to USDA regulations. If no, what actions would the State Agencies take in response to such a change in the primary contract brand formula?

d. For each State Agency, please indicate whether it is the intent to authorize any contract infant formulas that do not meet the minimum WIC requirements as specified in Table 4 at 246.10(e)(12)?

e. For each State Agency, please confirm that any non-exempt formulas that do not meet the minimum requirements per Table 4 of USDA regulations may only be issued with an authorized prescription, and only if such formulas are contract formulas.

f. For each State Agency that agrees to authorize contract infant formula products providing only 19 kcal per serving, what medical indication will be required to support the medical documentation requirements for issuance of such products?

NEATO must adhere to federal regulations when approving or issuing any formula. The primary contract infant formula must meet the minimum requirements listed in Table 4 of 7 C.F.R. 246.10(e)(12).

For formula issuance beyond the primary contract infant formula, NEATO will follow USDA guidance and clarification, including, but not limited to the USDA’s WIC Policy Memorandum #2014-1A which states, in relevant part, “Federal WIC regulations at 7 C.F.R. 246.10(d)(2)(ii) provide a WIC State agency the discretion to require medical documentation for any contract brand infant formula, other than the primary brand, that it chooses to authorize for issuance, and to decide whether some contract brand infant formula is issued under any circumstances. Additionally, medical documentation is required for the issuance of any noncontract brand infant formula and for any contract brand infant formula that does not meet the requirements of Table 4 of 7 C.F.R. 246.10(e)(12).”

10. Page 10, Section II.C.2.b. – What type of cooperation with the current manufacturer is expected with this provision. Please provide additional detail on this provision, including an example of the type of cooperation that might be expected.

The winning bidder must ensure delivery and availability of their contracted infant formula products during the transition from the existing contract and the commencement of a subsequent contract. The winning bidder’s product must be available for NEATO participants to purchase beginning October 1, 2016 through the final contract extension date.

11. Page 10-11 of 16, Section II.C.3. – We have the following questions:

a. How many authorized vendors are there in each State Agency?

State/Tribe Authorized WIC Vendors

Cherokee Nation

Connecticut

Massachusetts

Maine

New Hampshire

Rhode Island

Seneca Nation

b. We request a list of the authorized vendors in each state prior to the submission of bids.

Please see the seven (7) documents comprising Q & A Attachment 1, for NEATO vendor listings.

c. For each State Agency, how many WIC-only (above 50% vendors) are currently authorized? What percentage of WIC Food Instruments is redeemed at WIC-only stores?

None.

d. For each State Agency, what are the top five (5) WIC retailers measured by the percentage of WIC food volume (i.e., redeemed food instruments).

Food volume is not included in the list of items allowed to be released under 7 C.F.R. 246.26(e).

e. How many vendors have been disqualified from each State Agency WIC Program due to fraud issues in each of the last three years?

Vendor Disqualifications from 2013 to 2015:

Cherokee Nation - 0 Connecticut - 21 Maine - 2 Massachusetts - 72 New Hampshire - 4 Rhode Island - 25 Seneca Nation - 0

12. Page 12 of 16, Section II.E.1. (see also page 8 of 17, paragraph 7.b. of Attachment I) – We have the following questions:

a. In order to attract the best possible bids on this contract, please confirm mutual consent for contract extensions is required.

b. Does this provision allow for only one extension, or does it permit multiple extensions with a maximum additional term of two years?

The Agreement will not be so revised. The provision provides for one, two-year extension.

13. Page 12 of 16, Section II.E.2. – We have the following questions:

a. This section states “NEATO reserves the unilateral right to order changes . . . if such changes or delays do not alter the scope of the AGREEMENT.” Please provide more details on the types of changes NEATO might unilaterally order, including examples of the types of changes that might be requested.

b. How does NEATO define “scope of the AGREEMENT”?

This is standard contract language. Please see ITB, Attachment 1, the Draft AGREEMENT

14. Page 12 of 16, Section II.F.1. – Please explain the circumstances under which NEATO would reject a particular bidder’s bid. Please further describe what “part” of a bid might be rejected.

The bidder must fulfil all twelve (12) technical requirements of ITB Attachment 3: Evaluation Criteria and offer the lowest monthly net wholesale cost.

All bidders take notice: New Hampshire is requiring Q & A Attachment 4, entitled “NH Response to Exhibit Questions” Appendix A be filled out and returned with the New Hampshire bid package. Please do NOT include this document in the official bid being submitted to the Massachusetts Department of Public Health or the other states and tribes.

15. Page 14 of 16, Section III.K.2. – For each State Agency, please provide a listing of the minimum stocking requirements for each infant formula product expected to be authorized (or currently authorized). Please provide the stocking requirements for all three forms of formula.

Cherokee Nation: at least twenty (20) 12.5 oz cans Powder Enfamil Premium Infant; at least twenty (20) 12.9 oz cans Powder Enfamil Prosobee.

For all other state and tribes please see the seven (7) documents comprising Q & A Attachment 2, for the minimum stocking requirements.

16. Page 14 of 16, Section III.K.3. – Please confirm authorized vendors are responsible for maintaining adequate stock of authorized infant formulas. The manufacturer is responsible for fulfilling orders from retailers through its established distribution network.

Confirmed.

17. Page 14 of 16, Section III.K.4. – If there is a change in the manufacturer, please confirm each of the State Agencies will contact their authorized vendors to notify them of such change? We request the State Agencies agree to notify their authorized vendors 90 days prior to the start date of the contract to ensure adequate time for vendors to place orders for the new contract formulas?

Confirmed.

18. Page 14 of 16, Section III.K.4. – We request this paragraph be deleted in its entirety. The vendors are responsible for placing orders and stocking retail shelves with an adequate supply of infant formula, and we believe the State Agencies are in a better position to notify authorized WIC vendors of a change in contract formula. As the contract manufacturer our obligation is to ensure product is available for all orders placed on a timely basis.

The Agreement will not be so revised.

19. Page 14 of 16, Section III.K.4. – Will each State Agency also contact healthcare providers in their respective States and Tribes if there is a change in contract formula. Please provide a response for each State Agency.

Yes.

20. Page 15 of 16, Section K.8.(see also page 4 of 17, paragraph 2.i. of Attachment I) – We have the following questions:

a. This section defines a product shortage as “not available for order or has a factory back order or delivery failure of three (3) days or more. . .” We understand the Stage Agencies’ interest in ensuring an adequate supply of infant formula to its participants. However, we request this time period be amended to a more reasonable period upon which to make a determination of product shortage. We request this section be amended by replacing “three (3) days” with “seven (7) days.” The inability to fill an order within three days would not ordinarily affect product availability on the retail shelf. The 3-day timeframe is also a much shorter period than specified in nearly all other state WIC contracts. We therefore respectfully request this section be amended to seven days.

The Agreement will not be so revised.

b. We request this paragraph be amended by adding the phrase “and lawfully purchased” after “specified on food instruments issued” in line five of this paragraph. Please confirm this change will be made.

The Agreement will not be so revised.

21. Page 16 of 16, Section K.10. (see also page 6 of 17, paragraph 5.a. of Attachment I) - Please confirm the phrase “or portion thereof” in this section means the State Agencies intend to prorate the interest amount due by the number of days the payment is late? For example, if payment is received 10 days late, will the interest be calculated as one-third of the .75% additional payment? We request the State amend the solicitation to clarify the interest will be prorated. Doing so will encourage prompt payment by the manufacturer once it has discovered the payment is overdue.

Interest will be prorated based on the number of days the payment is late. The Agreement will not be so revised. This Q & A will be part of the final Agreement package.

Attachment I – Draft Agreement

22. Page 3 of 17, paragraph 2. – Is NEATO provide a projection of WIC’s anticipated “growth needs” during the term of this contract? For each State Agency, is infant participation expected to grow over the next 3-5 years?

NEATO cannot make any assurances, promises, or guarantees as to the number of participants expected during the life of any Agreement.

23. Page 4 of 17, paragraph g. – We have the following questions:

a. Please confirm natural disasters, extreme weather events, etc., are included within the provisions of this paragraph relieving the parties from delays or performance failures beyond the control of the parties.

Confirmed.

b. We request this paragraph be amended by replacing the phrase “its best” in line seven with “commercially reasonable.” Please confirm this change will be made.

The Agreement will not be so revised.

24. Page 4 of 17, paragraph i. – We have the following questions:

a. We request this paragraph be amended by replacing the phrase “it’s best” on line four with “commercially reasonable.”

Please see NEATO’s response to Nestle/Gerber’s question No. 23.b.

b. We strongly urge NEATO to delete the last two sentences of the paragraph. We consider this provision to be an unreasonable penalty imposed on the manufacturer. Please confirm these two sentences will be deleted.

The Agreement will not be so revised.

25. Page 7 of 17, paragraph 5.c. – We have the following questions related to this paragraph:

a. Please confirm these provisions apply only to disputes involving mathematical or other obvious errors on the invoice.

This is not confirmed.

b. Please confirm these provisions apply to the State Agencies as well – i.e., if the State Agency does not notify the manufacturer of any dispute or error in the rebate invoice within the specified time period, the State Agency waives its right to receive additional funds resulting from a dispute or under billing error.

This is not confirmed.

c. Please confirm the State Agencies will only bill the manufacturer for rebates on containers of infant formula lawfully purchased at authorized retail vendors by WIC participants.

NEATO adheres to all applicable federal guidelines regarding billing the Manufacturer for rebate.

d. Please confirm the NEATO State Agencies agree the manufacturer may recover funds in instances in which fraud has been discovered, and it has been further determined the manufacturer was overbilled for infant formula.

NEATO will work within federal and state regulations to resolve any payment issues related to fraud.

e. We request the State Agencies agree to discuss with the manufacturer awarded this contract appropriate contract language for addressing payment issues identified through manufacturer audits and/or fraud-related issues directly affecting the manufacturer. Please confirm the State Agencies will work with the manufacturer to address this issue.

The Agreement will be not be so revised. NEATO will cooperate as able in accordance with federal and state regulations to resolve any fraud/audit payment issues.

26. Page 8 of 17, paragraph 6. – We request this paragraph be amended by adding the phrase “lawfully purchased and redeemed” after “all cans of infant formula” in line one. Please confirm this paragraph will be amended accordingly.

Please see NEATO’s response to Nestle/Gerber’s question No. 20.b.

27. Page 9 of 17, paragraph 9. – We request this paragraph be amended by adding “the MANUFACTURER,” before “NEATO or any state or tribe” on line two. Please confirm this paragraph will be amended accordingly.

The Agreement will not be so revised.

28. Page 11 of 17, paragraph 15.a. – Is Attachment A the document titled Attachment 4, or is there a separate Attachment A that has been provided.

Attachment A and Attachment 4 are the federal regulations.

29. Page 12 of 17, paragraph 16.a. – Please confirm the State Agencies will fully cooperate with the manufacturer when the manufacturer is conducting an audit and please further confirm the State Agencies will comply with all reasonable requests for information necessary to conduct a proper audit.

NEATO will cooperate as able in accordance with federal and state regulations as well as generally accepted accounting principles (GAAP).

30. Page 12 of 17, paragraph 16.b. – We request this provision be amended to clarify the State Agencies agree to the release of vendor information when such release is part of discussions involving fraudulent transactions involving rebated infant formula products. Please confirm that if fraud is identified and the manufacturer requests relevant vendor information to further identify the scope of the fraudulent activity, the State Agencies agree to provide such information to the manufacturer.

The Agreement will not be so revised. NEATO must comply with federal WIC regulations 7 C.F.R. 246.26(e).

31. Page 12 of 17, paragraph 16.b. – We further request the State Agencies agree to notify the manufacturer when it disqualifies authorized vendors due to fraud-related issues.

Please see NEATO’s response to Nestle/Gerber’s question No. 30.

32. Page 12 of 17, paragraph 16.c. – We request this paragraph be deleted in its entirety.

The Agreement will not be so revised.

33. Page 12 of 17, paragraph 16.d. – We request this paragraph be deleted in its entirety. We would certainly agree to conduct all audits according to generally accepted auditing standards appropriate for this contract.

The Agreement will not be so revised.

Bid Sheet

34. The Bid Sheet requires all figures to be carried to three decimal places. However, the Percent Rebate column only carries this figure to one decimal place, and the cells in this column are locked. Please confirm only one decimal place is necessary for this column. If unable to confirm, please unlock this column or amend the formula in these cells.

Confirmed.

Data Tables

35. Table 1 – Participant Data – Please review the figures on this Table to verify the accuracy of the information provided. We believe there may be errors in the data. For example, the column for “Total # Enrolled Infants” does not equal the total of the other five columns. Also, the Infants Exclusively Breastfed for Massachusetts seems low, and the Infants Issued Exempt Formula for New Hampshire appears to be very high (nearly 16%). If this figure for New Hampshire issuance of exempt infant formula is correct, please provide an explanation for such unusually high issuance of exempt infant formulas.

Table 1 contains multiple data pulls with a mixture of enrolled and issuance data. NEATO is required to provide various participant data points for bids. We combined them into one table for convenience. Total enrolled do not equal the other columns of data.

The Massachusetts exclusively breastfed 6 month total is 19,617. The New Hampshire issuance of exempt formula is 362. Table 1 has been updated.

36. Table 1 – Would the State Agencies also consider revising this Table by providing the monthly average of infants for each of the columns provided? Would NEATO provide this and the other Tables as Excel spreadsheets as well?

The monthly average is provided for each column (row 13). All three tables are in an Excel Workbook.

37. Table 3 – Non-Contract Standard Formula – According to this Table, Massachusetts issued Similac Sensitive Powder formulas in June through November 2015. These formulas do not meet the minimum requirements for the WIC Program as detailed in Table 4 of USDA regulations. What is the medical indication used for issuance of this product to MA WIC infants?

Lactose intolerance. Please also see NEATO’s response to Nestle/Gerber’s question No. 9.

38. We request NEATO include an additional Table with the following information provided:

a. The number of infants currently receiving exempt infant formula products? Please provide monthly totals for the most recent six-month period.

b. The number of units of exempt infant formula products issued in each of six recent months, broken out by brand name and form.

This information is not pertinent to this ITB.

c. Please provide copies of each State Agency’s current policies with respect to the issuance of exempt infant formulas, and non-contract standard infant formulas.

Please see the eight (8) documents comprising Q & A Attachment 3, for state and tribe formula policies.

d. Do any of the State Agencies expect a change in their current policy regarding the issuance of non-contract standard formulas at the start of the new contract beginning October 1, 2016?

No.

State Specific Standard Contract Clauses

39. Please confirm the documents included in these Appendices do not have to be returned with the bids. Some of these documents appear to require signatures.

Confirmed.

Appendix B – Cherokee Nation

40. Please confirm the Drug Free and Tobacco Free Workplace provision is not applicable to this WIC infant formula rebate contract.

Cherokee Nation does not require the Drug Free and Tobacco Free Workplace provision with contractors/vendors that do not set foot on Cherokee Nation property.

41. In the “Hold Harmless” provision, “University” referred to in this section.

The word “University” has been changed to “Contractor”. Please see updated Appendix B, ITB, Attachment 1, Draft Agreement, Appendices B-E and G at pp. 1-4).

Appendix C – Connecticut

42. Section A.1. – Please confirm this provision is not applicable to this infant formula rebate contract. All of the prospective bidders are regulated by the federal Food and Drug Administration, which is provided legal authority to inspect our facilities and does so on an annual basis.

This is applicable.

43. Section B.2. – Please confirm this provision is not applicable to this WIC infant formula rebate contract.

This is applicable.

44. Section B.7. – Please confirm this provision is not applicable to this WIC infant formula rebate contract. The State Agencies are the entities responsible for compiling the data necessary to generate invoices to the manufacturer. The manufacturer does not maintain separate records for WIC infant formula sales, other than records of payment to WIC State Agencies.

This is applicable.

45. Section B.10. – Please confirm this provision is not applicable to this WIC infant formula rebate contract. If unable to confirm, please provide additional information regarding the manufacturer’s requirements to be in compliance with this section.

This is applicable. Please also see Nestle/Gerber’s question No. 49.

46. Section B.12. – We request this section apply to the State as well. Please confirm the State will have the same obligation to the manufacturer regarding the notice requirements of this section.

Confirmed.

47. Section C.1. – Please confirm this provision applies to the State as well.

Confirmed.

48. Section C.2. – Please confirm this provision applies to the State as well.

Confirmed.

49. Section C.7. – Please confirm this provision is not applicable to this WIC infant formula rebate contract.

This is applicable.

50. Section C.13. – Please confirm this provision is not applicable to this WIC infant formula rebate contract. The manufacturer will not have access to any of the information referred to in this provision.

Confirmed.

Appendix D – Maine

51. Paragraph 15. – Please confirm the termination provisions in the ITB and Sample Agreement take precedence over this provision.

This will be discussed with the winning bidder.

52. Paragraph 25 – We request the manufacturer be provided with the same discretion afforded the Department through this provision.

This will be discussed with the winning bidder.

53. Paragraph 26 – Please confirm this provision does not apply to this WIC infant formula rebate contract. The State is not making any payments to the manufacturer.

This will be discussed with the winning bidder.

54. Rider D, paragraph 1. – Please confirm this provision is not applicable to this WIC infant formula rebate contract. The manufacturer does not have access to confidential information, and the manufacturer is not a “Business Associate” under HIPPA.

This will be discussed with the winning bidder.

55. Rider D, paragraphs 8, 9, 11, 12, 19, 21, 22, and 24 - Please confirm these provisions are not applicable to this WIC infant formula rebate contract.

Please see updated Rider D entitled “Additional Requirements” (ITB, Attachment 1, Draft Agreement, Appendices B-E and G at pp. 25-28).

Appendix E – Massachusetts

56. Paragraph 5. – We request additional detail regarding the requirements of this section. The manufacturer will be providing infant formula through regular retail distribution channels used by WIC and non-WIC consumers. Please clarify the purpose and scope of this section.

Paragraph 5 addresses Massachusetts WIC’s policy on breastfeeding as it pertains to the use of materials, products, and services in local WIC Programs.

57. Paragraph 7. – Has Massachusetts received any “enhancements” from the current infant formula provider? We request this provision be deleted in its entirety.

No. The Agreement will not be so revised.

58. Paragraph 9. – Please confirm this provision is not applicable to this WIC infant formula rebate contract.

This is applicable.

59. Paragraph 11 – Please confirm the manufacturer has the right to audit the records of the Commonwealth for purposes of verifying the accuracy of the invoices submitted by the Commonwealth.

Confirmed. The Massachusetts WIC Program will cooperate as able in accordance with applicable federal and state regulations as well as generally accepted accounting principles (GAAP).

60. Paragraph 16 – We request this provision be deleted in its entirety.

The Agreement will not be so revised.

Appendix F – New Hampshire

61. Exhibit C, page 2 of 5, Section 9. – We request this provision be deleted in its entirety. In the alternative, please confirm this provision does not apply to this WIC infant formula rebate contract.

62. Exhibit H – Please confirm this provision is not applicable to this WIC infant formula rebate contract.

63. Exhibit I – Please confirm this provision is not applicable to this WIC infant formula rebate contract.

For questions 61-63, please see Q & A Attachment 4, entitled “NH Response to Exhibit Questions”.

Appendix G – Rhode Island

64. Par. 2 - Please confirm this provision is not applicable to this WIC infant formula rebate contract.

Confirmed.

65. Par. 7 - Please confirm this provision is not applicable to this WIC infant formula rebate contract.

Confirmed.

66. Par. 8.b. – Please confirm this provision applies to the State as well.

Confirmed.

67. Par. 9.4. - Please confirm this provision is not applicable to this WIC infant formula rebate contract.

Confirmed.

68. Par. 9. – We request the paragraph beginning with “The Contractor’s liability to the Executive office” and the next paragraph beginning with “The imposition of liquidated damages” be deleted in their entirety. In the alternative, please confirm these provisions do not apply to this WIC infant formula rebate contract.

Rhode Island boilerplate language cannot be modified or changed. This does not apply to the WIC infant formula contract.

69. Par. 9. – We request the paragraphs titled “Assurances before breach” and “Executive Office’s options at termination” – apply to the State as well.

Rhode Island boilerplate language cannot be modified or changed.

70. Par. 11. – Please confirm the 3rd paragraph in this section is not applicable to this WIC infant formula rebate contract.

Confirmed.

71. Par. 15. – Please confirm this provision is not applicable to this WIC infant formula rebate contract.

Confirmed.

72. Par. 20. and 21 – Please confirm these provision are not applicable to this WIC infant formula rebate contract.

Confirmed.

73. Par. 24. – Please confirm this provision is not applicable to this WIC infant formula rebate contract.

Confirmed.

Additional Questions

74. Please confirm Attachment 3 does not have to be returned with the bid.

Confirmed.

75. Would the NEATO State Agencies consider limiting authorized products to powder and ready-to-feed forms? Powdered infant formula is more cost-effective and the RTF form is available to those who have issues with water quality.

No.

76. The transition period for a new contract is an important, material provision of this solicitation and the resulting contract. We therefore request each State Agency outline the transition process it will utilize if there is a new supplier of infant formula. We request a response to the following questions:

a. Will participants entering the WIC clinic on August 1, 2016 receive Food Instruments for August, September, and October that include the existing manufacturer’s products, or will only the August and September Food Instruments cover the existing manufacturer’s products and the October Food Instrument cover the new manufacturer’s products?

All WIC Food Instruments with first use dates ON or AFTER October 1, 2016 would be for the new contract. All WIC Food Instruments with first use dates BEFORE October 1, 2016 would be for the current contract. Individual state and tribe transition processes can be discussed with the winning bidder.

b. If a participant visits the clinic on the 10th day of a month, is the “first day to use” date the 10th day of that month and the first day of the next two months (i.e., are Food Instruments issued on a rolling basis throughout the issuance period, or only for the first month)?

For most of NEATO, the first use date (FUD) is not determined by the clinic visit date. It is set by the participant’s certification date or in EBT state/tribes the household’s benefit day.

Cherokee Nation is in the process of changing to calendar month issuance. Seneca Nation follows calendar month issuance.

c. We request the solicitation be amended to include such details.

The Agreement will not be so revised.

d. Please provide more details on the Food Instrument issuance process to be used during the contract transition. For the non-EBT State Agencies, how many Food Instruments are issued to participants when they visit the clinic?

Typically, participants are issued three months of benefits per visit. Seneca Nation issues two months of benefits per visit.

II. Mead Johnson Questions

1. Section I.A. – Background – Pages 5 and 6 of 16

A. Please indicate what percent of infants that are enrolled in the WIC program were enrolled with incomes higher than 185% of the Federal poverty level for each State and Tribal Organization.

B. Please indicate what percent of infants that are enrolled in the WIC program were enrolled via adjunctive eligibility (i.e., they demonstrated active participation in SNAP, TANF, Medicaid or CHIP) for each State and Tribal Organization.

Please see NEATO’s response to Nestle/Gerber’s question No. 5.

C. With the exception of Massachusetts and Cherokee Nation, please advise the projected EBT implementation date for each State/Tribal Organization.

Please see NEATO’s response to Nestle/Gerber’s question No. 3.

D. Please confirm the following

a. The States and Tribal Organizations will not issue quantities of infant formula in excess of the monthly maximums prescribed by federal law for each WIC participant;

NEATO does not issue above the Maximum Monthly Allowance.

However, Connecticut has been given the authority via USDA WIC Policy Memorandum #2011-8 to issue over the monthly maximum allowance for certain forms of specific Mead Johnson formula in alternate packaging due to the Connecticut BPA legislation. Currently, Connecticut is not exercising this authority.

b. The Contractor will not be required to pay rebates on quantities of infant formula in excess of the federal monthly maximums; and

For Connecticut, the winning bidder would be required to pay rebate on quantities of specific formula that are allowed to be issued above the MMA.

c. If rebates for quantities in excess of the federal monthly maximums are billed and rebated in error, the amounts associated with the over issuance and redemption will be reimbursed to the Contractor upon discovery.

Confirmed for states and tribes other than Connecticut.

d. If any portion of D above is not confirmed, please provide a detailed explanation of why such portion was not confirmed.

Please see NEATO’s responses to Mead Johnson’s questions Nos. 1.D.a. - c., above.

E. Please describe how each State and Tribal Organization issue infant formula benefits. Do the States and Tribal Organizations issue benefits on a calendar month benefit (1st to last day of month) issuance schedule OR a rolling 30 days based on when the participant comes in for benefits)?

Please see NEATO’s response to Nestle/Gerber’s question No. 76.

F. If a calendar benefit period will be used and benefits are prorated during the participant’s initial benefit period, please explain how the initial proration affects the total number of cans to be rebated for the participant for the length of time the participant is receiving infant formula benefits. For example, if a participant receives a prorated amount during the first benefit period (i.e. 5 cans powder - 90 oz reconstituted), will that participant then receive full monthly allotments for the next 12 calendar months?

Only the first month is prorated. Please also see NEATO’s response to Nestle/Gerber’s question No. 76.

G. This section indicates that CT and RI currently round up to the next whole can. Please provide, for each state, how the state would handle an infant formula that reconstitutes to 98 fl ounces for each fully formula feeding package (0-3 months, 4-5 months and 6-11 months).

Rhode Island: for each category RI would take the monthly maximum amount and at some time would add a can to meet the MMA.

Connecticut: Full Formula package 0-3 months: 9, 8, 8, 8; 4-5 months: 10, 9; 6-11 months: 7, 7, 7, 6, 6, 6. Currently, the maximum number of cans are calculated outside of the system (see below) and entered into the MIS using the rounding methodology required by the federal regulations.

Formula reconst. ounces per can:

2. Section II.A.3 – Time Table – Page 7 of 16

A. Please provide the office and/or room number where the bid opening will be held at the Massachusetts Department of Public Health.

B. Please confirm the total net cost and total net cost per month from page 2 of the bid sheet (Attachment 2) will also be read aloud at the bid opening.

C. Please provide a call-in number where bidders can call into listen to the public bid opening.

Please see NEATO’s response to Nestle/Gerber’s question No. 7.

3. Section II.B.3 - How to Submit a Bid – Page 8 of 16

Please confirm a certificate of the Secretary or Assistant Secretary of the bidder certifying that the person signing the bid and contract is duly authorized by the bidder to sign WIC bids is sufficient for this section.

Confirmed.

4. Section II.B.5 - How to Submit a Bid – Page 8 of 16

Please provide the office and/or room number where the official sealed bid should be delivered at the Massachusetts Department of Public Health.

Beth Wilson-Lampro

WIC Nutrition Program

Massachusetts Department of Public Health

250 Washington Street, 6th floor

Boston, MA 02108

If delivered by courier: check in with the lobby guard and proceed to the WIC receptionist on the 6th floor. If mailing: deliver to the attention of Beth Wilson-Lampro. The mail room will be notified that all deliveries must go directly to Ms. Wilson-Lampro upon arrival.

5. Section II.B.6 - How to Submit a Bid – Page 8 of 16

A. If a conference call number is setup for the bid opening, it would satisfy the need for all states to hear the bid sheet numbers at the time of the opening. Requiring a bidder to deliver a copy of their bid submission to six different locations by the bid due date and time will require bidders to send their bid submission to arrive a day prior to the bid due date and time to ensure a timely delivery. This process seems to undermine the integrity of having a closed bid public opening process. Please remove this requirement.

B. If not removed, please confirm a bidder could send copies of their bid submission to the other six locations the day after the bid due date. This will ensure the integrity of the closed bid process and public bid opening at one address.

Please see NEATO’s response to Nestle/Gerber’s question No. 8.

6. Section II.D.4 – Bid Evaluation and Awards – Page 11 of 16

A. Please confirm the award notification will occur on May 4, 2016 or before.

B. If not confirmed, please advise the award notification date.

C. Please confirm that the successful and non-successful bidders will be notified of the bid award via email

D. If not confirmed, please describe how the successful and non-successful bidders will be notified in writing of the bid award.

The tentative date for award notification is May 4, 2016. The successful and non-successful bidders will be notified via email. The Award notification will also be posted on COMMBUYS.

7. Section II.E – Agreement Period – Page 12 of 16

A. Contracts with mutual extension options can be more attractive to potential bidders. Please consider changing this section to make the extension option mutual. If revised, please also make this change in the draft agreement.

B. Please provide the circumstance in which NEATO would order changes and/or delay initiation of the AGREEMENT.

Please see NEATO’s response to Nestle/Gerber’s questions Nos. 12 and 13.

8. Section II.G – State of Connecticut and New Hampshire Special Provisions – Page 13 of 16 Please confirm the Certificate of Good Standing from the NH Secretary of State is not required to be submitted as part of a potential bidder’s bid submission.

Confirmed. Please see Q & A Attachment 4, entitled “NH Response to Exhibit Questions.”

9. Section III.G – Goods and Services to be Provided – Page 14 of 16

To be consistent with the way new and existing product rebates will be calculated as referenced in Section 2.e in the Draft Agreement, please revise this section to read “If the successful bidder discontinues production of the primary contract infant formula, a rebate must be provided that yields the same percentage discount for the replacement formula”.

This reference is incorrect. Section III.G of the ITB refers to section 2.c of the Draft Agreement, NOT section 2.e. The Agreement will not be so revised.

10. Section III.I - Goods and Services to be Provided – Page 14 of 16

The USDA Policy Memorandum #2014-1 provides that “State agencies may not under any circumstances authorize a non-contract brand infant formula that does not meet the federal WIC minimum requirements and specifications”. Please describe how the current issuance of non-contract infant formula that has less that 20kcal/oz (as indicated on Table 3) complies with this federal requirement.

Please see NEATO’s response to Nestle/Gerber’s question No. 9.

11. Section III.K.6 - Goods and Services to be Provided – Page 15 of 16

A. On what basis would the Commonwealth deny an infant formula that was reformulated?

B. Since manufacturers are not making product solely for the NEATO States and Tribal Organizations, to allow the States and Tribal Organizations to have “sole right to make final determination of what constitutes an acceptable replacement” is not practical. Manufacturing a product formulated for and distributed only in the NEATO States/Tribal Organizations could dramatically affect a manufacturer’s ability to execute the requirements of this contract. Please remove this section.

C. If not removed, please provide the reasons that the States and Tribal Organizations feel that this provision is in the best interest of the States and Tribal Organizations, WIC infant participants and the contractor.

Each state/tribe determines formula acceptance based on federal regulations, the best interest of the participant, recent medical science, cost, and in the states that have them, recommendations of the Medical Advisory Board.

12. Section III.K.8 - Goods and Services to be Provided – Page 15 of 16

A. Given the fact that many retailers typically have ten to fourteen days of inventory on hand, please revise this section to read “…successful bidder’s product is not available for order or has a factory back order or delivery failure of five (5) business days or more which affects product availability…”.

B. If revised, please also change in the draft agreement.

The Agreement will not be so revised.

13. Appendix Data Table 1

It appears that the total # of enrolled infants should be the total of exclusive breastfed infants, partially breastfeed infants, fully formula fed infants, infants on non-contract standard formula and infants on exempt formula. However, these numbers do not add to the total enrolled infants. Please explain the difference between these numbers.

Please see NEATO’s response to Nestle/Gerber’s question No. 35.

14. Draft Agreement – Pages 1 - 17

Please confirm the draft agreement is not required to be included as part of a bidder’s bid submission.

Confirmed.

15. Draft Agreement – Section 2.c – Page 3 of 17

Please revise this section to read “…shall supply the replacement product(s) to NEATO at the same percentage discount for the alternative formula….” to be consistent with Section 2.e. in the Draft Agreement.

Please see NEATO’s response to Mead Johnson’s question No. 9.

16. Draft Agreement - Section 5.c – Page 7 of 17

Please confirm the 90 day time limit on disputes does not apply to disputes arising from fraud or other illegal activity that prevents the Contractor from being able to identify the incorrect billing earlier begins when the fraud or illegal activity is detected.

Please see NEATO’s response to Nestle/Gerber’s question No. 25.d.

17. Draft Agreement – Section 9 – Page 9 of 17

A. Please revise this section to provide the same cancellation rights to the manufacturer that are being provided to the States/Tribal Organizations or a cancellation right that would provide sufficient notification for NEATO to rebid the contract.

B. If not revised, please provide all the reasons why the manufacturer should not be allowed the same cancellation rights as the States/Tribal Organizations or a cancellation right that would provide sufficient notification to rebid the contract.

The Agreement will not be so revised. Section 8 of the Draft Agreement addresses terms and conditions for cancellation by the Manufacturer. States/tribes need sufficient time to meet all federal and state procurement requirements for a new ITB and to work with WIC staff, IT contractors, vendors, and participants to ensure a seamless transition in the event the Manufacturer cancels the Agreement.

18. Draft Agreement – Section 18 – Page 13 of 17

If no unique identifier per participant (e.g. pseudo Participant ID) is provided and multiple food instrument or EBT transactions are allowed for one month’s worth of benefits, please detail how the Contractor would be able to sum up the total number of infant formula cans redeemed by a single participant for the month to ensure that total cans issued did not exceed the federally regulated monthly maximums.

Cherokee Nation, Massachusetts, Maine, Rhode Island, and Seneca Nation use a unique identifier. New Hampshire: No unique identifier- provides voucher numbers.

Connecticut currently provides Participant ID numbers (not pseudo IDs) in a detailed report, as well as a monthly summary for the total number of cans redeemed.