JA - NTP PACS Upgrade_Final_Redacted.pdf

CONTROL NUMBER: VA-26-00042676

JA - FAR Part 6

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Activity: Department of Veterans Affairs (VA) Office of Procurement, Acquisition, and Logistics

Technology Acquisition Center 23 Christopher Way Eatontown, NJ 07724

2. Description of Action: The proposed action is for a sole source, firm-fixed-price contract with Intelerad Medical Systems, Inc. (Intelerad) for the upgrade of the existing National Teleradiology Program (NTP) Picture Archive and Communication System (PACS) from IntelePACS version 4.9 to version 5.7 or the most current version available at the time of implementation, including migration of all NTP-specific applications. The contract will also provide ensuing system maintenance and technical support for the upgraded platform.

3. Description of Supplies or Services: The proposed action is to perform a comprehensive upgrade of the latest commercially available software release. This effort includes migration and upgrade of all NTP PACS-specific applications from IntelePACS version 4.9 to version 5.7 or newer, deployed within the VA Enterprise Cloud (VAEC) environment, followed by subsequent system maintenance and technical support for the upgraded platform upon completion. The Contractor shall manage all VAEC resources associated with PACS, migrate NTP-specific applications and data, validate integrations with voice recognition, artificial intelligence (AI), Health Level Seven (HL7) interfaces, and analytics platforms, and ensure continuity of clinical workflows. Following successful activation, the Contractor will provide ongoing system maintenance, security updates, and technical support for the upgraded platform. Additionally, if full activation of the upgraded system is not completed by September 30, 2026, the Contractor shall continue to provide ongoing service and support for the legacy PACS to ensure uninterrupted clinical operations.

The base period of performance shall be 18 months from the date of contract award, consisting of 6 months for system deployment and acceptance and 12 months of service and support post go-live. The contract also includes 1 12-month option period, which will cover full system maintenance and technical support for the upgraded PACS. System maintenance and technical support includes but is not limited to continuous monitoring and management of the upgraded PACS environment to ensure secure, reliable, and uninterrupted clinical operations. This encompasses applying software updates and security patches, sustaining Authorization to Operate, managing VAEC resources, and maintaining integrations with voice recognition, AI and analytics platforms. It also involves proactive performance tuning, capacity planning, backup and disaster recovery readiness, incident response and resolution, and providing user support and training. The Contractor shall deliver all required documentation, maintain configuration baselines, and report service performance to meet VA standards and compliance requirements.

The contract also includes 1 12 month optional task that can be exercised in monthly

NTP IntelePACS Upgrade CONTROL NUMBER: VA-26-00042676 increments if full activation of the upgraded system is not completed by September 30, 2026. This optional task will allow the Contractor to continue providing ongoing service and support for the legacy PACS to ensure uninterrupted clinical operations.

The total estimated value of the proposed action, inclusive of the option period and optional task, is

4. Statutory Authority: The statutory authority permitting other than full and open competition is 41 U.S.C. 3304(a)(1) as implemented by the Federal Acquisition Regulation (FAR) 6.103- Supplies or Services Will Satisfy Agency Requirements.

5. Rationale Supporting Use of Authority Cited Above: The proposed source for this action is Intelerad, located at 800 De Maisonneuve Blvd East, 14th Floor, Montreal, Quebec. Intelerad is the Original Equipment Manufacturer (OEM) of the NTP PACS brand-name software, IntelePACS, and currently provides maintenance and support to the existing PACS system. Intelerad is the only responsible source capable of and associated licenses, which are the intellectual property of Intelerad. Access to the proprietary source code is essential for service, support, updates, and upgrades, as well as for ensuring proper configuration and continuous operation throughout the upgrade project. Intelerad does not sell its PACS software or support through resellers; therefore, only Intelerad can legally and technically provide the required updates and upgrades.

The Food and Drug Administration (FDA) requires that medical imaging systems, including PACS, maintain 510(k) clearance to ensure they are safe, effective, and substantially equivalent to legally marketed devices. This clearance is mandatory for clinical use and cannot be compromised during system upgrades. The IntelePACS platform currently deployed by NTP already holds FDA 510(k) clearance, and any modification or upgrade must preserve this status. Only Intelerad, as the OEM and holder of the clearance, can provide the software upgrades necessary to maintain compliance. Engaging any other source would invalidate the existing clearance, require a new FDA submission, and risk significant delays and disruption to patient care. Accordingly, only Intelerad possesses the legal authority, proprietary knowledge, and code access necessary to deliver compliant updates, upgrades, and sustained maintenance.

VA awarded a competitive action for a replacement PACS solution in June 2023, that would also enable VHA to standardize PACS across the enterprise. The solution was to be fully deployed within 12 months of award; however, due to extensive delays, the deployment schedule for the NextGen PACS solution was revised. This replacement PACS solution was rescheduled to deploy in November 2025; however, the system deployment ultimately failed. Therefore, NTP requires the existing IntelePACS to remain operational until an enterprise wide solution can be completed. The current version of the NTP PACS, IntelePACS 4.9, reached end of life on November 30, 2020, and VA NTP is currently utilizing a VA NTP-specific version of the PACS since it is critical to maintain support and keep the PACS operational. This requires a dedicated support team due to all of the customization NTP requires. The current contract for IntelePACS support expires on September 30, 2026. The NTP PACS is a mission-critical medical system supporting care for approximately 3,500 patients daily, including STAT interpretations. Any interruption in service could delay urgent diagnoses and treatments, posing significant risks to patient safety. Continuity of OEM support is essential to mitigate these risks and ensure rapid remediation of technical issues. Replacing the PACS with an alternative vendor would require full re-platforming, hardware replacement, and reconfiguration of HL7 and Digital Imaging and Communications in Medicine interfaces across more than 120 VA facilities. Replacement of the PACS would require an estimated 18-24 months for procurement and deployment, which would result in extensive delivery delays. Such delays would be clinically unacceptable given strict uptime requirements and the critical Veterans Health Administration need to have an operational and fully supported teleradiology PACS for NTP by October 1, 2026.

Based on OEM exclusivity, FDA compliance obligations, the proprietary nature of the software, and the patient safety imperative associated with continuous PACS uptime, Intelerad the NTP PACS upgrade and sustained maintenance.

6. 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 competition anticipated for this acquisition. Additionally, the proposed action will be synopsized on the Contracting Opportunities Page in accordance with FAR 5.201.

Any proposals that are received shall be evaluated.

7. Actions to Increase Competition: VA awarded a competitive action in June 2023, actively working towards an action for an enterprise imaging solution that is anticipated to be competed in 2026. As such, in order to remove or overcome barriers to competition in future acquisitions, the agency is continuing to perform market research so that other solutions can be considered.

8. Market Research: Extensive market research was conducted by the to identify potential sources capable of meeting the

This research included industry engagement by which VA technical representatives met with multiple PACS vendors including Agfa, Siemens, and Philips, during the Radiological Society of North America Annual Meeting in November 2025 to discuss enterprise imaging solutions and assess capabilities relevant to this procurement.

Additionally, VA technical experts reviewed similar clinical products such as Sectra PACS and MedWeb PACS requirements for the maintenance service and support of the current NTP IntelePACS solution research on web sites and utilized first-hand knowledge of commercial PACS that are deployed within VA. As a result, the technical experts confirmed that due to the proprietary data and code of the existing system, all of the vendors researched were unable to meet requirements as outlined in Section 5 and cannot be currently modified to meet those requirements. Intelerad is the only responsible vendor that can provide the upgraded IntelePACS and continued support to the existing PACS solution without a break in service and loss of current capabilities.

technical experts concluded that Intelerad is the only responsible source

IntelePACS software currently deployed and retains exclusive rights to the proprietary source code, licenses, and FDA 510(k) compliance framework necessary for updates and upgrades. No other vendor can legally or technically perform these services without replacing the entire PACS infrastructure which would result in the aforementioned unacceptable delays to urgent diagnoses and treatments, posing significant risks to patient safety.

9. Other Facts: None.