LSJ OVER SAT for FSS Orders VISN Ref Lab ARUP SIGNED_Redacted.pdf

VHAPG Part 808.405-6 Limiting Sources Attachment 2: Request for Limited Sources Justification Format >SAT

Effective Date: 02/01/2022 Page 1 of 8

LIMITED SOURCES JUSTIFICATION

ORDER >SAT

FAR PART 8.405-6

Acquisition Plan Action ID: 36C259-24-AP-0892 JOFOC Tracking Number: FY24-NCO19-1242

1. Contracting Activity: Department of Veterans Affairs, Network/Program Contracting Office (NCO)

19, located at 6162 South Willow Drive, Suite 300, Greenwood Village, CO 80111, in support of VISN 19 VA Health Care System.

Organizational Activities: PURCHASE REQUEST (2237):

a. VA Montana Health Care System 436-24-3-112-0072

1892 Williams St, Fort Harrison, MT 59636

b. Cheyenne VA Medical Center 442-24-2-054-0005 2360 E Pershing Blvd, Cheyenne, WY 82001

c. VA Eastern Colorado Health Care System 554-24-1-023-0048

1700 N Wheeling Street, Aurora, CO 80045

d. VA Western Colorado Health Care System 575-24-3-035-0065 2121 North Ave, Grand Junction, CO 81501

e. Eastern Oklahoma VA Health Care System 623-24-2-022-0205

1011 Honor Heights Dr., Muskogee, OK 74401

f. Oklahoma City VA Health Care System 635-24-3-114-0036 921 NE 13th St, Oklahoma City, OK 73104

g. VA Salt Lake City Health Care System 660-24-2-071-0032

500 Foothill Blvd, Salt Lake City, UT 84148

h. Sheridan VA Medical Center 666-24-1-113-0066 1898 Fort Rd. Sheridan, WY 82801

2. Description of Action: This acquisition is conducted under the authority of the Multiple-Award Schedule Program (41 U.S.C. 152(3) and 40 U.S.C. 501). The proposed action is a request for approval for a sole source award to the incumbent contractor, Associated Regional and University Pathologists (ARUP) Laboratories, for off-site Reference Laboratory Testing and Analysis Services.

This will be a firm-fixed price interim Federal Supply Schedule (FSS) Task Order against 36F79720D0079 until a new 5-year reference laboratory requirement can be solicited as full and open.

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Order against: FSS Contract Number: 36F79720D0079

Name of Proposed Contractor: ARUP Laboratories

Street Address: 500 Chipeta Way

City, State, Zip:

Phone:

Salt Lake City, UT, 84108 801-583-2787

3. Description of Supplies or Services:

The estimated value of the proposed action is $1,551,750.00 for six (6) months interim FSS Task Order.

This requirement is for Off-Site Reference Laboratory and Analysis Testing Services which includes pickup and transport of specimens, analytical processing as defined in its laboratory manual, analysis, reporting of analytical results and interpretation for clinical and anatomical pathological specimens. The incumbent contractor, Associated Regional and University Pathologists, Inc. (ARUP), will continue to provide a wide range of testing services in the specialized testing areas of hematology, chemistry, coagulation, microbiology, molecular, genetics, virology, clinical interpretation, cytology and anatomic pathology, oncology, and in specialized pathology support.

This Limited Source FSS Task Order will serve as an interim contract with a performance period of March 31, 2024 through September 30, 2024 to continue services without interruption and maintain critical patient care until a new, long-term contract is awarded. The current FSS-BPA expires on March 30, 2024 with no extensions available, leaving insufficient time to properly solicit and award.

4. Identify the Authority and Supporting Rationale (see below and if applicable, a demonstration of the proposed contractor’s unique qualifications to provide the required supply or service.

FAR 8.405-6(a)(1)(A): An urgent and compelling need exists, and following the procedures would result in unacceptable delays;

FAR 8.405-6(a)(1)(B): Only one source is capable of providing the supplies or services required at the level of quality required because the supplies or services are unique or highly specialized;

With a required start date of March 31, 2024, there is only one vendor currently in the position to provide all the requirements of the SOW, and that is the incumbent, ARUP for the following reasons:

Based on the market research, there are no small business concerns that can fulfil this requirement fully. There is also not enough time to compete this requirement while waiting for a new long-term contract to be established. ARUP is currently providing reference laboratory testing through a VA-approved electronic testing interface for all VISN 19 locations. Awarding to a new contractor would take 12-14 months of approvals and labor from each facility to input thousands of new test names, ranges, and more. Performance of this reference lab testing service is crucial to patient care and cannot be severed.

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ARUP already has their testing catalog built into VA systems and the streamlined electronic ordering in place to allow maximum efficiency for VISN 19 facilities to place test orders and receive results and analysis.

ARUP is the sole source for a number of tests (whether it be via test type or methodology) including:

a. Myelin Oligodendrocyte glycoprotein (MOG) antibodies

b. Adenosine deaminase testing in Cerebral Spinal Fluid (CSF), pleural fluid and pericardial fluid (for tuberculous diagnosis)

c. Cancer antigen-125 (CA-125) tumor marker in body fluids

d. Free (unbound) opiate testing in urine by mass spectrometry

• VISN 19 only tests for free opiate in urine samples in toxicology

• LabCorp testing includes both free and bound opiates, therefore VISN 19 facilities can only send method validation and regulated 6-month sample correlations to ARUP for accurate method comparisons

e. Treponema pallidum

f. Hemoglobin variant (A1C) reflex testing

g. Quantitative copper testing on tissue samples

h. Quantitative iron testing on tissue samples

FAR 8.405-6(a)(1)(C): In the interest of economy and efficiency, the new work is a logical follow-on to an original Federal Supply Schedule order provided that the original order was placed in accordance with the applicable Federal Supply Schedule ordering procedures. The original order must not have been previously issued under sole source or limited source procedures.

FAR 8.405-6(b): Items peculiar to one manufacturer:

A patent, copyright or proprietary data limits competition. The proprietary data is:

These are “direct replacements” parts/components for existing equipment.

The material/service must be compatible in all aspects (form, fit and function) with existing systems presently installed/performing.

5. Describe Why You Believe the Order Represents the Best Value consistent with FAR 8.404(d) to aid the Contracting Officer in making this best value determination

GSA has already determined the Federal Supply Schedule (FSS) prices of ARUP reference laboratory services to be fair and reasonable. A sampling of the latest ARUP FSS price list shows the same pricing as the current FSS-BPA (36C25921A0031) pricing. It is, therefore, the best value to the Government to award to ARUP as a sole source FSS Task Order.

6. Describe the Market Research Conducted among schedule holders and the results or a statement of the reason market research was not conducted.

I. The Contract Specialist (CS) posted a Sources Sought notice (36C25923Q0659) in Contract Opportunities through SAM.gov from 7/6/2023 through 8/11/2023. The sources sought notice asked potential contractors to provide the following:

Effective Date: 02/01/2022 Page 4 of 8

1. A completed copy of business information listed below with a capabilities statement.

2. Completed copy of the attachment (exhibit A) with responses for the full test menu.

3. A copy of the CLIA accreditation certificate for each laboratory listed in exhibit A.

4. A declaration signed by the Laboratory Director named on CLIA certificate that indicates that the test identified in Exhibit A are currently being performed at that laboratory.

Six businesses responded. None of the SDVOSBs were VetCert verified. Results are in the table below:

Business Name Business Size Exhibit A (Test Menu) CLIA Accreditation

Declaration signed by Laboratory Director Named on CLIA

Analytical Edge Laboratories, 120 NE 26th Street Oklahoma City , OK 73105

Declared itself Hub-Zone, SB and Veteran Owned -not certified SBA

Yes, can only perform 194 tests in-house

Yes- General Immunology, Virology, Toxicology

No

Space City Laboratories 12440 Emily Ct, Sugarland, TX 77478

SB,ESB SDB Yes, to all tests Yes- General Immunology, Routine Chemistry, Endocrinology, Hematology

No

Kashi Clinical Laboratories

10101 SW

Barber Blvd, Portland, OR 97219

SB Yes, can perform 1,989 tests in-house

Yes- Histocompatibility, Virology, General Immunology, Routing Chemistry, Urinalysis, Endocrinology, Toxicology, Hematology, ABO& RH Group

Yes

ARUP

500 Chipeta Way, SLC, UT 84108

Large Yes, can perform over 6,000 tests in-house

Yes – attached in email licensures and accreditation website

Yes

LabCorp 8490 Upland Dr., Englewood, CO 80112

Large Yes, can perform over 6,000 tests in-house

No No

Quest Diagnostics 1201 S.

Collegeville Rd, Large Yes, can perform over 6,000 tests in-house

Yes Yes

Effective Date: 02/01/2022 Page 5 of 8

Collegeville, PA 19426

II. The Contract Specialist (CS) conducted a VIP Search NAICS Code: 621511 Medical Laboratories with key words: Reference Laboratory. The search showed 12 results- 11 SDVOSB’s and 1 VOSB

Of the 12 results, only 3 can possibly provide reference laboratory services, but MCI Diagnostics

Center and Neo Services have the same ownership and management, and the third is Central Tox

LLC. This means that in actual fact, there are only two SDVOSB’s that are Certified through SBA.

Neither SDVOSB’s can provide all the specialized testing required for this solicitation. See section III below.

III. The CS conducted a search on GSA eLibrary with Medical Testing Source-SIN 621 II- Medical

Laboratory Testing and Analysis Services. The search resulted in fourteen (14) testing categories.

Categories by number:

1. 200 - Anatomic Pathology

2. 201 - Clinical Chemistry

3. 202 - Cytogenetics

4. 203 - Cytology, Category 621-204- Clinical drugs of Abuse and Toxicology, Category 621-205-

Endocrinology, Category 621-206- Hematology, Category 621-211 Serology

5. 207 - Hemostasis

6. 208 - Immunology

7. 209 - Microbiology

8. 210 - Organ and Disease Oriented Panels

9. 212 - Urinalysis

10. 213- Pharmacogenetics Pharmacogenomics

A summary of the market research results among schedule holders is below:

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The market research shows that only ARUP, Quest Diagnostics, and Lab Corp (all large businesses) can provide all Testing and Analysis Categories required.

IV. The CS conducted a search on the SBA’s Dynamic Small Business Search (DSBS) with NAICS Code: 621511 and keywords “Reference Laboratory” on 2/5/2024. The search resulted with 4 small businesses. See table below:

Name Business Size Capabilities

MCI Diagnostic Center

LLC.

1155 Kas Dr, Richardson TX 75081

SDVOSB, Minority

Owned, Self-Certified

Small Disadvantaged

Business, WOSB, EDWOSB

Reference Laboratory provides ABO & RH Group, Antibody Transfusion, Antibody Non- Transfusion, Antibody Identification, Allergen, Bacteriology, Chemistry, Compatibility, Cytology, Endocrinology, Histopathology,HIV,Hepatatitus,P arasitology,PharmacoGenetics,To xicology,Urinalysis,Virology and Immunology Test

Magnus Diagnostic

Laboratories Inc.

4641 Montgomery, Bethesda, MD 20814

Minority Owned, Self -

Certified Small

Disadvantaged

Business

Reference Laboratory provides Chemistry, Toxicology, Hematology, Immunology and Clinical

Trials

Hato Ray Pathology

Associates Inc.

300 Calle Manuel

Domenech, San Juan

PR. 00918-3509

Minority Owned, Self -

Certified Small

Disadvantaged

Business

Reference Laboratory located in San Juan, PR, provides Anatomic

Pathology, Cytopathology, Clinical Lab and FNA and

Thyroid Malignancy

Panels testing

Ipsum Diagnostics

LLC

8607 Roberts Dr.

Atlanta, GA 30350

Small Business Reference Laboratory provides molecular diagnostic testing for infectious disease pathogens and antibiotic resistance genes testing

In Summary, even though the VetBiz search, and SBA Dynamic Small Business Search showed several small businesses and SDVOSBs that can provide reference laboratory testing, none can provide the full menu of tests needed in all eight VA facilities.

Based on the market research, there are no small business concerns that can fulfil this requirement fully. There is also not enough time to compete this requirement while waiting for a new long-term contract to be established. ARUP is currently providing reference laboratory testing through a VA-approved electronic testing interface for all VISN 19 locations. Awarding to a new contractor would take 12-14 months of approvals and labor from each facility to input thousands of new test names,