JA ParEx - Final_Signed_REDACTED.pdf

Control Number VA-21-00070898

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 sole source action is for a firm-fixed price (FFP) contract with PAR Excellence (ParEx), 11500 Northlake Drive, Cincinnati, Ohio 45249 to reconfigure the current Point of Use (POU) ParEx interface to send data to Defense Medical Logistics Standard Support (DMLSS) using the Point of Care (POC) interface.

This effort includes reconfiguration of existing interfaces to include testing and troubleshooting technical support and POU hardware installation.

3. Description of Supplies or Services: The ParEx POU system is an information technology (IT) based inventory management system currently in use at VA medical centers (VAMCs) and Community Based Outreach Clinics (CBOCs). VA anticipates use of this system for a minimum of three (3) years. ParEx POU supply chain technology is implemented in areas where patients receive clinical services and where on-hand consumable supply inventory is tracked, stored, retrieved, and distributed by medical staff for use in patient care. ParEx is unique because it uses a physical, weight-based, calibrated scale system that removes the human element from inventory replenishment. This results in control over quantities and types of supplies stored, reduced need to inventory supplies manually and ability to analyze web-based information centrally. The end result is high supply chain efficiency at a reduced cost.

The DMLSS POU Integration effort was developed in support of the DMLSS Implementation Project, which is an interagency project between VA and the Department of Defense to implement one (1) supply chain system at VA. DMLSS will communicate with VA systems through a HealthConnect to Defense Automated Addressing System interface to include: the Financial Management System, the Credit Card System and Integrated Funds Distribution Control Point Activity, Accounting and Procurement, Electronic Contracting Management System, Federal/Non-Federal Receiving Reports, and POUs. Implementation is planned as a phased rollout of DMLSS as a Government Off the Shelf product using an adapted Software as a Service model. DMLSS rollout started with James A. Lovell Federal Health Care Center (JALFHCC) then to Veterans (Health) Information Systems Networks (VISN) 20 Initial Operating Capacity (IOC) sites, Mann-Grand staff (Spokane) and Seattle/American Lake (Puget Sound) and is planning to rollout to remaining the sites enterprise wide under this effort during the next five (5) years.

The Contractor will reconfigure the existing ParEx interface to communicate with the DMLSS material management system. This reconfiguration will ensure continued automated medical supply inventory management after transition from the VA’s legacy material management system (Veterans Information Systems and Technology Architecture (VistA) Generic Inventory Package (GIP)) to DMLSS/LogiCole. Lack of a

Point of Use Integration – PAR Excellence Control Number VA-21-00070898 reconfigured interface would negatively impact both the DMLSS program deployment timeline and the efficient delivery of care to Veterans across the VA enterprise. The Contractor will also provide cloud migration service to support VA’s infrastructure modernization efforts. The Contractor will provide technical services in support of ParEx Supply POU installation to include hardware and software required at each site.

The period of performance is 12 months from date of award, with two (2) 12-month option periods to coincide with the DMLSS rollout schedule across VA and two (2) optional tasks. The optional tasks are: 1) ParEx-DMLSS integrations for up to an additional 87 sites 2) Migration of ParEx systems from on-premise data centers to VA Enterprise Cloud (3) ParEx Supply POU system (hardware and software) installation.

The total estimated value of the proposed action is xxxxxxxxxxxxx, inclusive of all option periods and optional tasks.

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) 6.302-1 entitled, “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.”

5. Rationale Supporting Use of Authority Cited Above: The VHA Supply Chain Systems Office conducted a POU inventory data call in the Fall of 2020. It was found that ParEx POUs are implemented at seven (7) VISNs (4, 6, 10, 16, 17, 19, and 20) in approximately xx VAMCs and affiliated CBOCs. ParEx POU IT supporting infrastructure is hosted at the Denver Data Center for VISN 20, and at VA medical centers for the remaining sites outside VISN 20. ParEx servers are hosted within VA Office of Information and Technology (OIT) network and the technology can use a VA preferred database. Both servers and databases are managed by VA OIT but, importantly, the underlying software and technology can only be modified by ParEx to allow new functionality, including the functionality needed to meet VA’s current need.

Based on market research, as described in detail in paragraph 8 of this document, and due to the proprietary nature of ParEx’s POU system, VA technical experts determined that no other POU contractor is capable of providing ParEx POU integration with DMLSS, nor are there any resellers of ParEx products or services. As such, ParEx is the only vendor that can meet interoperability and compatibility efforts with VA’s existing material management infrastructure and future material management infrastructure to support a DMLSS Enterprise Supply Chain modernization. ParEx interoperability and compatibility with the DMLSS material management system is in support of the VA’s Enterprise Supply Chain Modernization efforts and would automate medical supply replenishment when supply levels fall below reorder point. This would replace associated manual inventory management processes, improve supply chain efficiency and increase productivity for staff whose responsibilities include tracking inventory, ordering, requisitions, and restocking of medical supplies. Selection of any other POU contractor would require removal and replacement of ParEx’s proprietary POU system and equipment as the incoming system would be incompatible with the existing ParEx solution. This would require an extensive, time-consuming transition effort from the current ParEx system to a new POU product. For the reasons stated above, the required reconfiguration can only be accomplished by ParEx.

Furthermore, procurement of another manufacturer’s POU system, equipment installation and training would require duplicative costs of approximately xxxxxxx per site (approximately xxxxxx for the xx VAMCs and affiliated CBOCs in which ParEx POUs are utilized). This replacement would take about one (1) year per site to complete. These estimates are based on previous acquisition history and, importantly, the costs and time needed to implement a new system would not be recouped through competition. Additionally, no other POU product supports cloud application solutions.

This supports VA’s objectives of modernizing supply chain management systems by migrating applications and databases to centralized cloud infrastructure. It also enables deployment of highly-available and agile infrastructure that is fault-tolerant.

If another POU vendor were selected, there would be risk incurred due to lapse of inventory management services at sites where ParEx is already installed. ParEx POU technology is proprietary and cannot be reconfigured, managed, or established by another vendor. A such, selection of a new vendor would require a complete transition effort from the current ParEx system to a new POU product. This transition would be costly and time consuming. In addition, failure to integrate the ParEx system with DMLSS would reduce the timeliness of expendable medical supply replenishment and disrupt supply chain operations at sites where ParEx systems are installed. Finally, qwitching to a new vendor’s POU system would also present a steep learning curve for logistics staff and clinicians who are currently familiar with the functional and technical capabilities of the ParEx system. This would in turn negatively impact the efficient delivery of medical supplies needed in the delivery of care to Veterans across the VA enterprise.

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 additional sources that can meet the Government’s requirements. There is no competition anticipated for this acquisition. Additionally, the proposed action will be synopsized on Contract Opportunities on SAM.gov in accordance with FAR 5.201. Any proposals that are received shall be evaluated.

7. Actions to Increase Competition: The Government will continue to conduct market research to ascertain if there are changes in the market place that would enable future actions to be competed.

8. Market Research: Market research was conducted between August 2020 and January 2021 by a core team consisting of business, technical, and Enterprise Program Management Office Demand Management Division (EPMO DMD) Technical Assessment subject matter experts. At the request of the VHA Supply Chain Systems Office (SCS) and OIT Supply Chain Management Product Line Manager (SCMPLM), OIT conducted a series of technical interviews with alternative POU vendors including Omnicell and Becton Dickinson (Pyxis) to assess their POU system infrastructure and environments. These are the three primary vendors that provide Supply POU systems to the VA enterprise.The outcome of the evaluation established that only ParEx can support the reconfiguration of existing ParEx interfaces to material management systems (DMLSS/LogiCole) as well as HealthConnect, the message broker. VA’s market research confirmed that no other vendor can modify ParEx proprietary software and technology to provide interface development and ensure ParEx interoperability and compatibility with the DMLSS material management system in support of the VA’s Enterprise Supply Chain Modernization efforts, nor are there any resellers of ParEx products or services. System integration between existing and future ParEx POU systems and DMLSS would improve productivity for staff whose responsibilities include tracking inventory, ordering, requisitions, and restocking.

Based on this market research, the VA’s technical experts determined that no other vendor can provide interface development to ensure ParEx interoperability and compatibility with the DMLSS material management system in support of the VA’s Enterprise Supply Chain Modernization efforts without removing the existing system and providing a whole new product which is required to be tested, validated, installed and inclusive of training. No current provider could assume support of the existing system without a complete replacement of the ParEx proprietary POU.

9. Other Facts: None.