JA_GHSC-PSM_TO4 to GHAA 5 19 2023 - for SAM posting.pdf

TAB 2 -

JUSTIFICATION AND APPROVAL FOR OTHER THAN FULL AND OPEN COMPETITION (J&A)

TO: Dr. Atul Atmaram Gawande, Assistant Administrator, AA/GH

FROM: Nancy Lowenthal, Office Director, GH/MCHN

DATE: May 19, 2023

SUBJECT: Jus�fica�on and Approval (J&A) for Other than Full and Open Compe��on to Modify Contract #AID-OAA-I-15-00004/AID-OAA-TO-16-000018, Global Health Supply Chain-Procurement and Supply Management (GHSC-PSM) Task Order 4 Maternal Child Health and Nutri�on (MCHN)

1. This document sets forth the facts and ra�onale jus�fying the use of other than full and open compe��on, in accordance with AIDAR 706.302-70(b) (3)(i). This document was prepared by GH/MCHN/MNH for the GHSC-PSM Maternal Child Health and Nutri�on Task Order 4 (Contract

#AID-OAA-I-15-00004/AID-OAA-TO-16-000018).

2. The nature and/or descrip�on of the ac�on being approved:

This is a request to approve a modifica�on of Task Order AID-OAA-TO-16-000018 (TO4) with Contractor Chemonics, under the GHSC-PSM single award indefinite delivery/indefinite quan�ty (IDIQ) contract . This task order award is a Cost-Plus-Fixed Fee (CPFF) term contract with a total es�mated cost (TEC) of $216,894,103. The ini�al task order period of performance (PoP) was September 16, 2016-September 15, 2021.

On April 23, 2020 TO 4 PoP was extended to November 28, 2023. The extension was meant to ensure the con�nuity of services during the GHSC-PSM follow-on contract design and award period.

The extension also reduced the TEC from $229,618,330 to $216,894,103 and increased the level of effort (LOE) to 2,031,832 hours in support of field opera�ons, and 206,200 hours in support of Headquarters opera�ons.

The ac�ons proposed here are to: 1) extend the PoP from November 28, 2023 to November 28, 2024; 2) increase the LOE in support of field opera�ons by 214,708 hours from 2,031,832 hours to 2,246,540 hours ; 3) increase the LOE for support of Headquarters opera�ons, central procurement, and Headquarters support to field programs by 18,706 from 206,200 to 224,906 h ours ; and 4) increase the total es�mated cost by $28,846,237 from $216,894,103 to $245,740,340 .

Under this ac�on, Chemonics will con�nue to provide procurement and supply chain management technical assistance for Maternal Child Health and Nutri�on (MCHN) commodi�es for USAID-supported countries.

The GHSC-PSM , Single Award IDIQ Contract promotes an uninterrupted supply of health commodi�es to prevent suffering, save lives, and create a brighter future for families across the globe. There are five Task Orders (TOs) under the IDIQ: TO1 which provides commodi�es and technical assistance related to HIV/AIDS, TO2 which provides commodi�es and technical assistance related to malaria, TO3 which provides commodi�es and technical assistance related to FP/RH, TO4 which provides commodi�es and technical assistance related to MCHN, and TO5 which provides cross-element technical assistance for the Kenya Mission as a bilateral award.

GHSC-PSM TO4 directly supports the MCHN Office’s priority and USAID’s goal of preven�ng child and maternal deaths (PCMD). MCH programs’ aim to increase availability, access, and appropriate use of quality-assured, affordable MCH commodi�es, largely by providing technical support to host country governments' ministries of health. By providing these commodi�es and technical assistance to country governments and other key public and private sector stakeholders, improvement is reflected in forecas�ng and supply planning, procurement, distribu�on, quality assurance, and other supply chain func�ons. Since the start of the task order the project has procured and delivered essen�al MCH commodi�es to 12 USAID supported countries and supported 15 countries with supply chain technical assistance/distribu�on assistance. In addi�on, TO4 provided support to the COVID-19 response in ten countries since the start of the pandemic and was the lead for the ZIKA response which provided technical assistance support to seven countries and procurements to 15 countries.

3. Descrip�on of the supplies or services required, including an es�mated value:

Based on the current TO4 burn rate a TEC increase of $28,846,237 will be required to fund the requested 12 months of addi�onal TA and commodity procurements. The LOE in support of field opera�ons will need to increase by 214,708 hours from 2,031,832 hours to 2,246,540 hours, and the LOE in support of headquarters opera�ons, central procurement, and headquarters by 18,706 from 206,200 to 224,906 h ours .

In FY22, TO4 supported 11 countries throughout sub-Saharan Africa (inclusive of Madagascar), 2 countries in Asia, and 1 country in La�n America/Caribbean with the mandate to supply essen�al medicines commodi�es and/or provide technical assistance. Each of these programs relies heavily on the availability of essen�al health commodi�es. It is expected that most of these programs will con�nue to require TO4 services during the proposed extension period with the likelihood of addi�onal countries reques�ng service through TO4.

GHSC-PSM TO4 currently ends on November 28, 2023. The TEC of TO4 is $216,894,103. The follow-on design and solicita�on of the follow-on contracts are underway (i.e., the Next Genera�on

Global Health Supply Chain Suite of Programs, “NextGen”). However, absent an extension in TO4, the expected award dates will result in an actual gap between the current task order and NextGen contracts, resul�ng in interrup�on of services in MCHN commodity procurement and delivery services.

The follow-on design and solicita�on of the NextGen contracts is underway, with the award dates to be staggered over approximately the next 12 months. Unless GHSC-PSM TO4 is extended, these expected award dates will result in insufficient overlap resul�ng in an interrup�on in MCHN commodity programming and a gap in essen�al medicine and MCHN commodity procurement and technical assistance. Most MCHN commodity orders are placed once a year in the late summer for delivery during the following year. MCHN orders for delivery in FY 24 must be placed by August 2023. Therefore, in the absence of a period of performance extension, Missions will not be able to place and receive orders for 2024 and there is a risk of stock-out of essen�al medicine and MCHN commodi�es at health facili�es, thereby widening the gap of the unmet need of services for women and children.

For example, pneumonia accounts for 14% of all deaths of children under five-5 globally. It claims the life of a child every 39 seconds 1 . Pneumonia-related deaths are preventable and can be treated with an�bio�cs (amoxicillin), an essen�al MCHN commodity. Preven�ng child and maternal deaths is a USG foreign assistance priority and an uninterrupted supply of essen�al medicine and MCHN commodi�es, along with technical assistance, is needed to ensure these products are available for the users. Without the extension of this task order to support MCHN procurement and technical assistance, foreign assistance objec�ves could be significantly impaired.

4. Statutory authority permi�ng other than full and open compe��on:

This ac�on is requested under the authority of AIDAR 706.302-70 Impairment of foreign aid programs (b) (3)(i) which states “An award for which the Assistant Administrator responsible for the project or program makes a formal wri�en Determina�on and Findings (D&F), that compliance with full and open compe��on procedures would impair foreign assistance objec�ves, and would be inconsistent with the fulfillment of the foreign assistance program.” No other authority provided under FAR 6.302 or AIDAR 706.302 is suitable.

5. A demonstra�on that the proposed contractor’s unique qualifica�ons or the nature of the acquisi�on that requires use of the authority cited:

The principal reason for the extension to GHSC-PSM TO4 is to avoid impairment of the U.S.

Government’s foreign assistance objec�ves in global health, in par�cular to prevent child and maternal deaths. Ensuring the availability of essen�al MCHN commodi�es is a cri�cal input to achieving these objec�ves and the proposed extension is needed to ensure that there are no service disrup�ons in access to a range of high-quality essen�al medicines, MCHN commodi�es and

1 https://www.who.int/news-room/fact-sheets/detail/pneumonia supply chain technical assistance to country programs during USAID’s transi�on from the GHSC Program to the NextGen follow-on contracts. A gap in the services provided by TO4 risks significant disrup�on in these cri�cal, lifesaving programs.

It is impera�ve that the NextGen follow-on contractors have adequate �me to assume 100% responsibility for USAID’s MCHN commodity supply chain and technical assistance from the incumbent contractor. The �meline to procure and deliver MCHN commodi�es for 2024 delivery will occur well before the NextGen contracts are awarded and become fully opera�onal, leading to poten�al stockout outs of MCHN commodi�es in 2024. There is now an unacceptably high probability of not ensuring adequate �me, which could result in an interrup�on of essen�al medicines, MCHN commodi�es and technical assistance to clients unless the GHSC-PSM TO4 is extended to November 2024. Experience has taught USAID that there should be a transi�on and overlap period of 18 months for the new NextGen contractor(s) to assume full responsibility. One of the lessons learned during the transi�on from the previous USAID | DELIVER PROJECT and SCMS contracts to the current GHSC Program was that the 12-month overlap was not sufficient for a flexible transi�on period to ensure a seamless supply of MCHN commodi�es and services. A House Foreign Affairs Commi�ee inves�ga�on into performance challenges early in the GHSC-PSM project noted that a longer overlap period would have helped manage the transi�on and recommended a longer period of overlap for future supply chain programs. MCHN envisions the transi�on will be a gradual process, through which the new contractor(s) will be given increasingly greater responsibility. MCHN does not expect all countries to transi�on at the same �me, with each �meline being dependent on the complexity of the country program. GHSC-PSM will transi�on from the lead role to a suppor�ng role so that together the incumbent and new contractor(s) manage the transi�on to avert stock outs and/or meet other important requirements, resul�ng in the new contractor(s) eventually assuming 100% responsibility for the next itera�on of USAID’s MCHN supply chain program.

In providing the needed flexibility, USAID is planning for an overlap period of 18 months between PSM and the NextGen contracts, with the transi�on expected to begin in June 2023, to allow the new contractor(s) to plan, implement and complete an orderly transi�on by November 2024.

GHSC-PSM TO4 will be transi�oning ac�vi�es to at least five of the NextGen awards, Integrated Procurement Service Agent (Integrated PSA), Comprehensive Technical Assistance, Qualifying Issuing & Tes�ng (QuTI) and In-Country Logis�cs. The awards are unlikely to be awarded at the same �me and the 18 months will allow transi�on of ac�vi�es across the various awards based on staggered award dates. The longer flexible transi�on will permit incremental increases in the new contractors’ responsibili�es and corresponding decreases in the current contractor’s responsibili�es. USAID does not an�cipate con�nuing its use of the GHSC-PSM TO4 contract once all transi�on ac�vi�es are complete and all performance responsibili�es are successfully handed over to the new NextGen contractor(s). The currently expected award dates for NextGen do not allow for the necessary 18-month transi�on period based on the current TO4 end date, which could result in an interrup�on in the Agency’s provision of life-saving commodi�es to clients unless the GHSC-PSM TO4 is extended to November 2024.

In addi�on to the overlap between contracts, it is important to extend the period of performance and increase the LOE to provide �mely assurance to the Missions that these services will con�nue and they will be able to receive crucial commodi�es in 2024. The proposed extension also accounts for the fact that the GHSC-PSM TO4 contractor will need approximately three months for in-country and HQ office close-out during which no addi�onal procurement or technical assistance will be undertaken. The current contractor is uniquely qualified to provide the necessary procurement and technical assistance services between November 2023 and November 2024 because the contractor has established procurement systems and subcontracts with suppliers of MCHN commodi�es that will be needed over the course of the addi�onal period of performance. Establishing subcontracts to procure the volume of product currently purchased by the GHSC-PSM TO4 contractor is a lengthy process. For example pu�ng a new framework subcontract in place takes between 4 to 6 months and a standard pharmaceu�cal contract takes 2 to 4 months. In addi�on, the current project has field offices established in 15 MCHN supported countries which provide supply chain technical assistance to Missions through this USAID central mechanism. The contractor's performance has been sa�sfactory or above for the past year.

While the compe��ve process for the NextGen awards is underway, it is impossible under TO4’s current end date to provide for the needed transi�on �me. It is cri�cal that GHSC-PSM TO4 is allowed to begin to renego�ate and extend subcontracts now, and allow manufacturers to plan extended manufacturing schedules with sufficient lead �me. In addi�on to the exis�ng procurement systems and supplier subcontracts, the contractor provides shared services, such as freight and logis�cs and management informa�on systems, across the four procurement-related GHSC-PSM Task Orders. As the largest task orders, TO1 HIV and TO2 Malaria cover most of the costs of the shared services. In July 2022, TO1 HIV received approval to extend the period of performance to November 28, 2024 using the PEPFAR Expedited Procedures Package authori�es. In December 2022, TO2 Malaria received authoriza�on to extend the period of performance relying on AIDAR 706.302-70(b)(3)(i),approved by the Assistant Administrator for Global Health. As TO3 and TO4 share a por�on of the services that are also needed by TO1 and TO2, extending TO4’s period of performance to align with TO1 and TO2 will allow con�nued sharing of cri�cal services across the task orders and result in con�nued efficiencies as the programs transi�on to NextGen contracts.

A direct award to a local contractor was not considered given the nature of the global procurement, that work under the contract is for 27 countries, and the �me needed to establish subcontracts with suppliers and quality control laboratories.

6. Descrip�on of the efforts made to ensure that offers are solicited from as many poten�al sources as prac�cable, including whether a no�ce was publicized as required by FAR 5.2 [AIDAR 705.2].

Per AIDAR 705.202, jus�fica�ons and approvals to restrict compe��on under the authority of AIDAR 706.302-70(b)(1)-(3) are exempt from pre-award synopsis pos�ng. Once the D&F is approved, the J&A will be posted publicly per the requirements in FAR 6.305.

The follow-on contracts to this task order and the other mechanisms of the Global Health Supply Chain (GHSC) Program are in the process of being compe��vely awarded under the Next Genera�on Supply Chain Suite of Programs (NextGen). Consequently, offers from other sources were not solicited.

In accordance with AIDAR 706.302.70(b) (Impairment of Foreign Aid Programs) Global Health Bureau (GH) has considered the op�on of awarding a separate contract using full and open compe��on, which could lead to USAID obtaining addi�onal value or be�er contractual terms, but concluded that does not make sense given the follow-on awards are currently under procurement.

A cost benefit analysis shows these poten�al benefits are offset by the cost associated with start-up and close-out of a new contract in such a short period of �me. GH’s and OAA’s �meline analysis indicates that the earliest a new bridge contract could be designed, competed, and awarded using full and open compe��on is November 2023 which is past the current last order date. This approach could jeopardize ordering under GHSC-PSM and cause a significant gap in procurement and delivery of life-saving health commodi�es. In addi�on, this compe��vely-awarded bridge contract would only be opera�onal for a brief period before the follow-on contract(s) are awarded.

Therefore, USAID’s best and most viable op�on is to pursue an extension of the current task order through November 2024.

7. A determina�on by the Contrac�ng Officer that the an�cipated cost to the Government will be fair and reasonable:

Based on an Independent Government Cost Es�mate (IGCE) prepared by the COR and the costs incurred under the current task order contract, the Contrac�ng Officer, in approving this J&A, determines the an�cipated cost to the government to be fair and reasonable. There is no change in the scope of work. All previously-incurred costs were determined to be fair and reasonable. No new types of costs are an�cipated.

8. Descrip�on of the market research conducted, and the results or a statement of the reasons market research was not conducted:

Market research was conducted prior to awarding the Task Order and again prior to the design and compe��on of the NextGen awards. The targeted market research for the Task Order extension primarily consisted of consulta�ons with USAID GH staff suppor�ng the USAID MCHN por�olio and OAA. Due to the scale and complexity of the program no other mechanisms and vendors were iden�fied that could quickly mobilize these specialized services for USAID.

9. Other facts suppor�ng the use of other than full and open compe��on:

None.

10. Sources, if any, that expressed an interest, in wri�ng, in the acquisi�on:

None.

11. The ac�ons the Agency may take to remove or overcome any barriers to compe��on before any subsequent acquisi�on for the supplies or services required:

No barriers currently exist for new entrants into this domain; however, USAID is compe�ng the follow-on to the GHSC-PSM TO4 contract and all the other NextGen contracts for the same or similar services of the GHSC Program.

12. Technical or Requirements Personnel Cer�fica�on:

In accordance with FAR 6.303, I hereby cer�fy that the technical statements included above and which form a basis for the jus�fica�on are complement and accurate.

_____5/1/2023_________________ Date

Keith Hummel Keith Hummel, Technical Office Representa�ve

13. Contracting Officer Signature:

In accordance with FAR 6.303, I hereby cer�fy that the jus�fica�on is accurate and complete to the best of my knowledge and belief.

Robert Combs, Contrac�ng Officer

___5/2/2023____________________ Date

14. Approval

Approved via Action Memorandum from Nancy Lowenthal, Office Director, GH/MCHN for the Assistant Administrator, Bureau for Global Health dated 5/19/23 signed by Dr. Atul Gawande, Assistant Administrator, AA/GH on 6/2/2023