Sole Source Justificaiton_Redacted.pdf

Attachment 1: Request for Sole Source Justification Format >SAT

VHAPG Part 806.3 OFOC Page 1 of 5 Revision: 03 Effective Date: 04/15/24 Acquisition ID#: 36C262-24-AP-8904

DEPARTMENT OF VETERANS AFFAIRS

Justification and Approval (J&A) For

Other Than Full and Open Competition (>SAT)

Acquisition Plan Action ID: 36C262-24-AP-8904

1. Contracting Activity: Department of Veterans Affairs, Veterans Integrated Service

Networks (VISN), Network Contracting Office (NCO) 22, for VA Loma Linda Healthcare System, 605-25-1-059-0005.

2. Nature and/or Description of the Action Being Processed:

This is to establish a new single award firm fixed-price Indefinite Quantity Indefintie Delivery (IDIQ) contract vehicle for VA Loma Linda Healthcare System Nuclear Medicine Service for Tc-99m Tilmanocept Lymphoseek needed to care for veterans patients.

Manufacturing of Lymphoseek must be in accordance with all state and Food and Drug Administration (FDA) regulations, and the delivery must meet all Department of Transporation (DoT) requirements for shipment and delivery of radioactive drugs as well.

Since the requesting service has repetitive needs of Lymphoseek, this contract order will be base plus opion four years. The estimated cost of this requirement is $ including option years.

3. Description of Supplies/Services Required to Meet the Agency’s Needs:

The requirement is to procure one radioactive drug callsed Lymphoseek upon demend. As this is for medical supplies, Gray Market and Counterfeit Items (VAAR 852.212-71) applies.

The contractor must be an OEM, authorized dealer, authorized distributor, or authorized resller for the proposed item. The requesting service requires routine orders to be delivered the next business days, and emergency orders to be delivered same day and with the time specified during the placement of order. For unit-dose items, products must be pre-drawn into a syringe and calibrated upon delivery. The contractor must package, mark, and transfer all radioactive drug in accordance with all applicable local, state, and federal regulations.

Also all pharmacists employed by the contractor must be an authorized user on the contractor’s radioactive material licnese. The pharmacy of the contractor must be licensed by the state of operation and by the Nuclear Regulatory Commion or Agreement State Agency.

Delivery personnel must be trained in Radiation Safety Technicians, Nuclear Regulatory Commision, Joint Commion safety guidelines and Departmetn of Transproation requirements.

Market research determind there is only one business capable of providing Lymphoseek.

Cardinal Health 414, LLC has a propriety right and patent to manufacture and distribute Lymphoseek. Cardinal Health 414, LLC is considered a large business under NAICS code 325412.

VHAPG Part 806.3 OFOC Page 3 of 5

Acquisition ID#: 36C262-24-AP-8904 manufacture and distribute Lymphoseek, which makes them the only responsible source since no substitution can be permitted.

Lymphoseek is patented and unique. Melanoma and breast cancer frequently metastasize to the lymphatic system. Therefore, when a patient has surgery to remove the culprit tumor, it is imperative to find the sentinel node (first node in a lymphatic chain) to determine if the cancer has spread. Lymphoseek goes to the sentinel node by active receptor targeting (CD206 receptor), which gives reliable stability - never separates from the receptor, and only the radioactivity will fade away. Since Lymphoseek is receptor target specific, there is a lack of progression to the other nodes in the nodal chain, which allows more accurate identification of the sentinel node on the nuclear medicine scan. The location of this node is communicated to the surgeon, who will be able to find it during surgery the following day.

Unlike Lymphoseek, other agents (such as filtered sulfur colloid) separate from the receptor.

These agents have a mechanism of action based on particle size and phagocytosis (gathering large particles by lymphatics) which is less effective. Lymphoseek has its superior ability of targeting the active receptor and allows the drug to stay in only that receptor and the radioactiveity to fade away. Lymphosek provides the most superior image quality localizing involved lymp nodes in patients.

Cardinal Health 414, LLC is capable of fulling all required delivery timeframes and adhere to all federal and state regulations as required in manufacturing and delivery of these type of highly specialized radoative drugs. The company has successfully delivered and completed similar requirements at multiple VISN 22 VA Medical Centers in the past.

Based on information above, this requirement can be only provided by Cardinal Health 414, LLC; refer to the proprietary and authorized distributor letter uploaded to eCMS briefcase as P03.

6. Description of Efforts Made to ensure that offers are solicited from as many potential sources as deemed practicable:

In-depth market research was conducted. Small Business Administration (SBA)’s VetCert was utilized to survey capable SDVOSBs or VSOBs who can fulfill this requirement.

SAM.gov and FPDS portals were reviewed to research and study the results of recent market research undertaken to meet similar or identical requirements within VISN 22. Governmetn-wide database such as GSA Advanntage and VA National Acquistion Center (NAC) Pharmaceutical Catalog were queried. Also, a special notice, Notice of Intent, was posted on SAM.gov on 9/17/2024, which closed on 9/27/2024, to survey other capable businesses who can deliver Lymphoseek. Results of conducted market research finding are described under #8.

7. Determination by the CO that the Anticipated Cost to the Government will be Fair and

Reasonable:

During market research utilizing SAM.gov and FPDS, CS discovered the similar requirement procured by NCO 9 for Memphis VA Medical Center. CS reached out and received a copy of P02 Market Research, P03 Sole Source Justificaiton, S19 Offer Abstract, and C03 Executed Contract. The contract# was also set up as a single award Indefinite

VHAPG Part 806.3 OFOC Page 4 of 5

Acquisition ID#: 36C262-24-AP-8904

Quantity Indefinite Delivery Contract for base plus option four years for Lymphoseek. CS will utilize the past award action to determine the cost fair and reasonableness in accordance with FAR FAR 13.106-3(a)(2)(ii).

8. Description of the Market Research Conducted and the Results, or a Statement of the Reasons Market Research Was Not Conducted:

SBA’s VetCert query returned 133 SD/VOSBs registered under NAICS code 325412 – Pharmaceutical Preparation Manufacturing. However, this finding could not conclude these identified SD/VOSBs are authorized distributor of Lymphoseek or if they have capabilities to deliver Lymphoseek.

SAM.gov and FPDS revealed multiple past contract awards made to Cardinal Health 414, LLC for Lymphoseek. Contract# was awarded by NCO 22 for VA San Diego Healthcare System in the amount of $ for period of performance 10/2/23 through 10/1/24. This contract was sole sourced using FAR 6.302-1 per FPDS record.

Another similar contract was identified: IDIQ contract# , which was procured by NCO 9 for Memphis VA Medical Center. This IDIQ contract includes Lymphoseek as well as F-18 FDG. The estimated total contract value of # is $ for base plus option four years (10/1/23 through 9/30/28). This contract was also sole sourced using FAR 6.302-1 procedure based on FPDS record. Copies of FPDS records are uploaded to eCMS briefcase as P02 FPDS Findings.

VA NAC Pharmaceutical Catalog was used to search if Lymphoseek is available through an existing contract vehicle. However, no related item was found. A copy of VA NAC finding is uploaded to eCMS briefcase as P02 VA NAC search.

A special notice, an Intent to Sole Source, was posted on SAM.gov to see if there are any other business capable of providing Lymphoseek. It was posted on 9/17/2024 through 9/27/2024; however, zero response was received.

Market research indicates that Cardinal Health 414, LLC is the only capable and authorized distributor of Lymphoseek. There is no other business capable to fulfill this requirement.

9. Any Other Facts Supporting the Use of Other than Full and Open Competition:

Lymphoseek is a proprietary radiopharmaceutical drug. Cardinal Health 414, LLC has a proprietary right to manufacture and distribute Lymphoseek. Cardinal Health 414, LLC has provided a proof of the product being proprietary; the proprietary and authorized distributor letter from Cardinal Health 414, LLC has been uploaded to eCMS briefcase as P03.

10. Listing of Sources that Expressed, in Writing, an Interest in the Acquisition:

Cardinal Health 414, LLC 7000 Cardinal Place, Dublion, OH 43017 Heather Maldonado <Heather.Maldonado@cardinalhealth.com>

VHAPG Part 806.3 OFOC Page 5 of 5

Acquisition ID#: 36C262-24-AP-8904

11. A Statement of the Actions, if any, the Agency May Take to Remove or Overcome any

Barriers to Competition before Making subsequent acquisitions for the supplies or services required:

Currently Cardinal Health 414, LLC is the sole source of the proprietary item, Lymphosek, but the Deparmtent of Veterans Affairs will continue to monitor if any SDVOSBs, VOSBs, or other targeted small business concerns becomes authorized distributors. The Department of Veterans Affairs will also continue to survey market place for better therapies that will offer veterans the most up to date care.

12. Requirements Certification: I certify that the requirement outlined in this justification is a Bona Fide Need of the Department of Veterans Affairs and 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.

Administrative Officer Nuclear Medicine Service VA Loma Linda Healthcare System

13. Approvals in accordance with the VHAPM Part 806.3 OFOC SOP:

a. Contracting Officer Certification (required): I certify that the foregoing justification is accurate and complete to the best of my knowledge and belief.

Contracting Officer

NCO 22

b. One Level Above the Contracting Officer (Required over SAT but not exceeding $750K): I certify the justification meets requirements for other than full and open competition.

Branch Chief, Supply 4

NCO 22