Redacted_Justification_and_Approval_-_Stryker_Maintenance_FY16.pdf

Control No: 16-RHCO-C-141

Maintenance Service Agreement for Government-Owned Stryker Equipment

For Official Use Only

(See FAR 2.101 and 3.104-4)

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Justification and Approval for Other than Full and Open Competition

1. Contracting Activity: Regional Health Contracting Office – Central (Provisional); Carl R.

Darnall Army Medical Center (CRDAMC), Fort Hood, Texas 76544.

2. Description of Action: This is a new contract for Stryker equipment maintenance. This action will be accomplished through the use of a firm-fixed price contract for a period of performance from 1 April 2016 to 30 September 2016, plus three twelve-month options. DHP funds will be used for this acquisition.

3. Description of Supplies/Services: Non-Personal Services to provide scheduled and unscheduled maintenance according to the Performance Work Statement (PWS) to include parts, and labor on the Government-owned, Stryker Equipment. FY16 Funds are currently available for the base period of this acquisition. Funds for the subsequent option periods will be subject to the availability of funds. The total estimated amount of this contract is $889,373.00 for a period of performance of 1 April 2016 through 30 September 2019 (six-month base period plus three (3) twelve-month option years).

4. Authority Cited: 10 U.S.C. § 2304 (c)(1) as implemented by Federal Acquisition Regulation

6.302-1(a)(2)(iii)(B), Only one response source and no other supplies or services will satisfy agency requirements.

5. Reason for Authority Cited: Stryker Enterprises is the only vendor that has the proprietary license software and trained personnel to provide these services for Government owned Stryker equipment.

6. Efforts to Obtain Competition: In the future, the Government will utilize the sources sought option as the government’s mission changes and the current equipment becomes obsolete there may be more companies that can provide this type of technical expertise. The life cycle of these systems is estimated between 1 – 5 years. This office will continue to monitor the market for any new participants that may be able to provide this type of technical expertise for any follow-on requirements. The largest hindrance to competition is the cost of replacement, when you have a requirement for this many working parts and components, that spans across the CRDAMC platform it is going to be very expensive to replace, an estimated $550,000.00 will have to be spent to replace these items. This office will continue to work towards measures to eliminate or reduce competitive barriers.

7. Actions to Increase Competition: Due to proprietary rights and diagrams of the equipment, no other vendor can provide the required services.

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8. Market Research: Market Research through the SBA Dynamic Small Business Quick

Market Search will be conducted to identify Small Businesses with NAICS Code 811219.

Vendor profiles will be assessed to determine if they could satisfy the requirement. Upon review of the capabilities of vendors with similar maintenance programs, this procurement will be deemed price reasonable, therefore the price received from Stryker Enterprises will represent the best value and result in the lowest overall cost alternative to meet the needs of CRDAMC.

Stryker is the manufacturer and sole authorized distributor of the equipment and instruments needed to provide these services.

9. Interested Sources: Was a sources sought notice posted and if so when and what were the results? A Sources Sought was posted to ASFI for ten (10) days, with only one email received.

The vendor stated that they were an authorized distributor of Stryker equipment, but did not provide maintenance on said equipment.

10. Other Facts Supporting the Justification: The items for service were manufactured by

Stryker Enterprises. They do not sell their parts, materials, processes or proprietary tool to third party vendors; therefore, only authorized Stryker trained technicians can provide the needed service. The use on non-Stryker technicians or components nullifies any warranties and liabilities that are currently in place on these instruments. Additionally, using a third party service may jeopardize the joint Commission study for the CRDAMC. Under the Stryker agreement, all replacement parts used are Original Equipment Manufacturer (OEM). Any damage caused by non-Stryker repairs or components voids any future repairs by Stryker that were still covered under previous liability/warranty agreements. Additionally, when a repair is required, Stryker will provide a loaner piece of equipment to ensure that there is no lapse in care. The total replacement value for all Stryker Instruments in the inventory is $550,000.00.

a. Procurement history. This procurement is to purchase non-personal services for Stryker instruments at the Carl R. Darnall Army Medical Center (CRDAMC), Fort Hood, TX. The

Government does not possess the manpower assets or equipment to accommodate this workload and without this service the Government may not have the tools available as needed by the surgeons during surgery which may impact the mission of the warfighter. Contract W81K00-12-

C-0045, was extended for six (6) months. The current vendor is a large business and this procurement is expected to be procured as a sole source acquisition.

(1) Contract numbers and dates of the current award:

W81K00-12-C-0045 = $755,580.75 (1 Oct 12 – 31 March 2016).

(2) Competitive status of these actions. N/A.

(3) Authority previously used for less than full and open competition.

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FAR 8.405-6 (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.

(4) A Sources Sought was posted to ASFI for ten (10) days, with only one email received.

The vendor stated that they were an authorized distributor of Stryker equipment, but does not provide maintenance on said equipment.

(5) If any prior award was accomplished by full and open competition, a detailed explanation of the changed circumstances. The previous acquisition was also procured as a sole source this is the exact same requirement all equipment remains in place.

(6) An explanation of any unusual patterns which may be revealed by the history, e.g., several consecutive, urgent buys. Nothing to report.

(7) If a justification was prepared to support the procurement made before this one, briefly describe the circumstances justifying the buy and whether there have been any significant changes. No changes were identified from the previous procurement. Stryker is the only company that is authorized to work on this equipment due to the proprietary nature of this equipment. Stryker is the Original Equipment Manufacturer (OEM) and they have no authorized maintenance providers.

a. Acquisition data availability. N/A

b. Unusual and compelling urgency. N/A

c. Subcontracting competition. N/A

11. Technical/Certification:

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

Typed Name: ________________________________________ Date: ___________________

Title: _______________________________ Signature: _______________________________

12. Requirements Certification:

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

Signature: _____________________________________ Date: __________________________

Typed Name: _________________________________ Title: ____________________________

13. Fair and Reasonable Cost Determination:

I hereby determine that the anticipated cost to the Government for this contract action will be fair and reasonable.

14. Contracting Officer Certification:

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

Signature: ___________________________________________ Date: ____________________

Typed Name: ______________________________________ Title: _______________________

APPROVAL

Based on the foregoing justification, I hereby approve the $889,373.00 procurement of the six

(6) month base and three (3) twelve-month options years, for the Maintenance of Stryker equipment, on an other than full and open competition basis pursuant to the authority of FAR §

6.302-1\(a)(2)(iii)(B), only one response source and no other supplies or services will satisfy agency requirements, for the period 1 April 2016 through 30 September 2019, subject to availability of funds for the options, and provided that the services herein described have otherwise been authorized for acquisition.