JA - 3D Systems Final_BR_DR (ejf).pdf

DEPARTMENT OF VETERANS AFFAIRS

Office of Procurement, Acquisition and Logistics (OPAL) Strategic Acquisition Center (SAC)

5202 Presidents Ct, Suite 103 Frederick, MD 21703

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Justification and Approval for Other than Full and Open Competition 6.302-1 Only one responsible source and no other supplies or services will satisfy agency requirements.

1. Contracting Activity: Department of Veterans Affairs Office of Procurement, Acquisition and Logistics Strategic Acquisition Center–Frederick 5202 Presidents Court – Suite 103

2. Nature and/or description of the action being approve.

This activity proposes to negotiate a non-competitive firm fixed price sole source award with 3D Systems, INC., a large business, to provide 3D Medical Device design, testing and Quality Management Systems (QMS) activities using their unique vertical knowledge as an original equipment manufacturer (OEM) of multiple 3D printing technologies applicable to VA, OEM of 3D printing feedstock Duraform ProX PA polyamide material, and FDA registered medical device manufacturer producing 3D printed medical devices on US soil.

3. A description of the supplies or services required to meet the agency’s needs

(including the estimated value).

A primary goal of the Veterans Health Administration (VHA) Innovation Ecosystem’s (IE) Agile Design and Production Transformation (ADAPT) is to transition the Enterprise’s growing advanced manufacturing capabilities from the creation of 3D printed products to meet supply chain deficiencies during the COVID-19 pandemic to the creation of patient-matched medical devices to improve the care of Veterans, secure access to needed medical supplies in the face of unforeseen supply chain disruptions, and secure VA’s position as a leader in healthcare innovations.

One year ago, VA acquired five ProX6100 SLS printers, running Duraform ProX PA polyamide material and manufactured by 3D Systems, for use at three initial VA hospitals under the ADAPT initiative. These printers were chosen because they could significantly boost VA internal production of 3D printed nasal swabs, with each printer having the capability to produce 4000 swabs a day. Since the successful creation of nasal swabs, VA has sought to extend the capabilities and reach of these printers, using the technology as the backbone for the creation of 3D printed patient-matched surgical guides for maxillofacial surgeries.

VA now seeks to expand upon this foundation, taking multiple 3D printed medical devices from concept through design, prototyping, testing and FDA registration as a VA-

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P a g e 2 | 5 manufactured product. The success of this endeavor rests on VA strategically partnering with a consultant who is an OEM of 3D printers owned by VHA and has 1) experience in bringing 3D printed medical devices through the concept phase to FDA clearance and clinical deployment, 2) experience with distributed manufacturing of these devices within the United States and 3) willingness to assist VA in developing and listing products under the VHA brand, distinct from the consultant. Market analysis was conducted to identify potential partners, and 3D Systems was the only company that met the requirements.

The estimated value of this Firm-Fixed Price contract is $5,825,400.00 and the period of performance is a one 12-month base period.

4. Authority:

In accordance with Federal Acquisition Regulation (FAR)6.302-1 only one source is capable of providing the services required at the level of quality required because the services are unique and highly specialized.

(1) The justification prepared pursuant to FAR 6.302-5(c)(2)(ii) will be posted on SAM.gov in accordance with FAR subpart 5.301(d);

(2) The company has been determined to be a responsible source with respect to performance;

(3) In the estimation of the contracting officer, contract award can be made at a fair and reasonable price that offers best value to the Government; and

(4) The contracting officer has determined that the use of this authority is in the best interest of the government based upon the fact that 3D Systems, INC has a satisfactory performance history and is the only source with the capability to perform the required services.

5. A statement demonstrating the unique qualifications of the proposed contractor or the nature of the action requiring use of the authority cited.

The unique qualifications and/or specialized capabilities or expertise not prevalent in the marketplace of the proposed contractor, 3D Systems, INC. 3D Systems is the only known 3D printing Original Equipment Manufacturer (OEM) of both 3D printing hardware and software which also has a proven track record of medical device manufacturing on US soil. Additionally, 3D Systems, Inc. has quality/regulatory and training/consulting core competencies. https://www.3dsystems.com/healthcare. 3D Systems has designed, developed and oversees more than 100 medical implants through 510K clearance with FDA, with greater than 500,000 of those devices implanted in patients worldwide. 3D Systems has proprietary information about the inner workings of the ProX6100 SLS printers that VA owns, and thus is uniquely equipped to assist VA in installation, https://www.acquisition.gov/content/part-6-competition-requirements#i1119843 https://www.acquisition.gov/content/part-5-publicizing-contract-actions#i1120562 https://www.3dsystems.com/healthcare

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P a g e 3 | 5 operations, and production qualifications of these printers—a critical component of the design, testing and registration of 3D printed medical devices. 3D Systems operates within the United States, and produces its medical devices within its Denver, CO facility.

This is critical for VHA, as we seek a partner who knows how to manufacture in adherence to US standards, and source materials within the US or successfully secure supply chains from abroad when needed. 3D Systems has been in the 3D printing industry since 1986 and has been registered as a medical device manufacturer with the FDA for the past 10 years.

https://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfRL/rl.cfm.

6. A description of efforts made to ensure that offers are solicited from as many potential sources as is practicable, including whether a notice was or will be publicized as required by Subpart 5.2 and, if not, which exception under 5.202 applies.

The contracting officer has determined that a sole source award to 3D Systems, INC, is in the best interest of the government. The contracting officer determines that the anticipated prices will be fair and reasonable based on the results of the market research conducted for this procurement.

A notice will be publicized as required by Subpart 5.2.

7. A determination by the Contracting Officer that the anticipated cost to the

Government will be fair and reasonable.

No award shall be made until the Contracting Officer determines the cost to the Government to be fair and reasonable. This determination will be based on a comparison of current contract pricing, past proposal submissions (if available), other information made available, and an Independent Government Cost Estimate.

8. A description of the market research conducted (see Part 10) and the results or a statement of the reason market research was not conducted.

Market research was conducted by assembling a comprehensive list of 3D printer OEMs, cross-referencing it against existing technologies already established within the VA 3D printing network, and searching the FDA database for registration and listings of medical implants, which is the next product on the VHA roadmap (https://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfRL/rl.cfm). Only 1 3D printing OEMs had registered with the FDA and listed a medical implant- 3D Systems. Medical Modeling – a 3D Systems Company, located in Colorado, USA (registration number 1724955), had 29 medical devices and 9 implants listed, including multiple knee prostheses, an ankle arthroplasty implantation system, and multiple spinal fusion devices.

https://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfRL/rl.cfm https://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfRL/rl.cfm

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9. Any other facts supporting the use of other than full and open competition.

VHA is emerging as a leader in 3D printing and is ahead of other hospital systems in its commitment to provide Veterans with patient-matched medical devices that cannot be purchased on the open market. The steps taken by VHA to date include the creation of 3D printing manufacturing capabilities in 3 hospitals and registration of those hospitals with FDA as a medical device manufacturer. However, without the appropriate partner to accelerate the formation of a robust medical device development and manufacturing process, VHA will have to learn through mistakes and failures as it blazes a trail. A strategic partnership with an entity who has already made mistakes and failures and is willing to share these lessons learned and help VHA leapfrog to manufacturing success is paramount for the timely delivery of 3D printing innovations to Veterans.

10. A listing of the sources, if any, that expressed, in writing, an interest in the acquisition.

3D Systems 333 Three D Systems Cir Rock Hill SC 29730

11. A statement of the actions, if any, the agency may take to remove or overcome any barriers to competition before any subsequent acquisition for the supplies or services required.

The Agency will continue to attend innovation and 3D printing conferences, monitor 3D printing news sources, and check the FDA registration and listing site to determine if additional vendors meet qualifications in the future.

12. Efforts to Obtain Competition:

Market research was conducted, details of which are in the market research section of this document. This effort did not yield any additional sources that can meet the Government’s requirements. There is no competition anticipated for this acquisition.

Strategic Acquisition Center (SAC) 5202 Presidents Ct, Suite 103

Frederick, MD 21703

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13. Certifications / Signatures.

Technical and Requirements Certification:

I certify that the supporting data under my cognizance, which are included in this justification, are accurate and complete to the best of my knowledge and belief.

Dr. Beth Ripley Date Deputy Chief, Office of Healthcare Innovation and Learning

Contracting Officer Certification:

I certify that this justification is accurate and complete to the best of my knowledge and belief.

David Rupert

___7/28/2021________ Date

Contracting Officer

Competition Advocate Approval:

In my role as Competition Advocate for the procuring activity, based on the forgoing justification, I hereby approve this Sole Source Justification, on an other-than-full- and-open competition basis pursuant to the statutory authority cited in paragraph 4 above, subject to availability of funds, and provided that the items herein described have otherwise been authorized for acquisition.

Efrain J. Fernandez Date Competition Advocate Director, Strategic Acquisition Center-Frederick (SAC-F)

7/28/2021