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Sole Source Justification Format >SAT

VHAPG Part 806.3 OFOC Revision: 03 Effective Date: 04/15/24 Acquisition ID#: 36C248-25-AP-1521

DEPARTMENT OF VETERANS AFFAIRS

Justification and Approval (J&A) For

Other Than Full and Open Competition (>SAT)

Acquisition Plan Action ID: 36C248-25-AP-1521

1. Contracting Activity: James A. Haley Veterans' Hospital (JAHVH ) 13000 Bruce B.

Downs Blvd Tampa, FL 33612, Room D153-01.

2237: 673-25-2-022-0074

2. Nature and/or Description of the Action Being Processed: The JAHVH has an urgent and compelling need for the immediate repair of a VA-owned Siemens Somatom Definition Adaptive Scanner (AS) 64 radiographic unit. This is a critical need that directly affects the ability to provide diagnostic imaging services. We urgently need to procure materials, parts, and labor to repair the electrical equipment (EE) #131854 in Room D153-01.

3. This request is for

Other Than Full and Open Competition to procure materials, parts, and labor for the repair of the Siemens SOMATOM Definition Adaptive Scanner (AS) 64 radiographic unit electrical equipment (EE) #131854. The repair includes the replacement of the Straton MX P X -Ray tube. The current X-Ray cannot be repaired and must be replaced immediately. The X -Ray tube is a crucial component of the system, necessary for generating compute tomographic medical images of diagnostic quality for interpretation by a radiologist.

Immediate Impact to Operations: This request is paramount to the care of veterans.

This Computed Tomography (CT) unit has completely failed and is non-functional.

Failure to implement this critical repair support in the most expeditious manner would cause significant impact to health care operations at James A. Haley VAMC. The result is an unacceptably high risk of devastating effect to patient care directly affecting the ability for diagnosis and treatment of veterans.

Total Estimated Cost (including installation): $274,895.44.

4. Statutory Authority Permitting Other than Full and Open Competition:

(x ) (1) Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements per 41 USC §3304(a)(1) as implemented by FAR 6.302-1;

( ) (2) Unusual and Compelling Urgency per 41 USC §3304(a)(2) as implemented by

FAR 6.302-2;

( ) (3) Industrial Mobilization, Engineering, Developmental or Research Capability or Expert Services per 41 USC §3304(a)(3) as implemented by

FAR 6.302-3;

( ) (4) International Agreement per 41 USC §3304(a)(4) as implemented by FAR

Revision: 03 Effective Date: 04/15/24 Acquisition ID#: 36C248-25-AP-1521

6.302- 4;

( ) (5) Authorized or Required by Statute per 41 USC §3304(a)(5) as implemented by

FAR 6.302-5;

( ) (6) National Security per 41 USC §3304(a)(6) as implemented by FAR 6.302-6;

( ) (7) Public Interest per 41 USC §3304(a)(7) as implemented by FAR 6.302- 7;

5. Demonstration that the Contractors Unique Qualifications or Nature of the Acquisition Requires the Use of the Authority Cited Above (applicability of authority): The required part, the X-Ray (CT) Tube, is proprietary to the manufacturer.

Siemens Medical Solutions USA, Inc. is the only identified and authorized vendor capable of which is essential for this advanced medical imaging system.

The digital CT system, which includes the X-ray tube as a key component, is currently unable to produce images, which is its primary function. This digital CT unit is a highly specialized medical imaging system. Access to Siemens' proprietary service documentation, diagnostic tools, software, equipment, and parts is restricted.

Unauthorized third-party entities that are not approved by the original equipment manufacturer (OEM) typically do not have access to these crucial resources and, as a result, cannot perform maintenance or repair work on advanced medical imaging equipment.

6. Description of Efforts Made to ensure that offers are solicited from as many potential sources as deemed practicable: SIEMENS owns the rights to the equipment and has replacement parts inventories, qualified personnel, access to manufacturer maintenance publications, and proprietary diagnostic software that is not available to third-party vendors.

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

On February 22, 2023, Siemens provided emergency repairs for MRI and CT/PET machines for the Smart Pool DEA 8-Ring. The total cost for one repair was $142,583.84, linked to contract #36C24823P0683. According to Siemens' commercial price list, the quoted labor rate for this repair was $630.00 per hour. However, Siemens applied a 12% government discount, bringing the net labor rate down to $554.40 per hour.

On August 4, 2023, Siemens conducted emergency repairs for the Straton MXP X-Ray CT Tube (P/N: 10141785). The total cost for this repair was $201,712.70, linked to contract #36C26323P0885. According to Siemens' commercial price list, the quoted labor rate for this repair was $630.00 per hour. After applying a 12% government discount, the net labor rate was reduced to $554.40 per hour.

On October 6, 2023, Siemens again provided emergency repairs for the Straton MXP X- Ray CT Tube (P/N: 10141785). The total cost for this repair was also $201,712.70, Revision: 03 Effective Date: 04/15/24 Acquisition ID#: 36C248-25-AP-1521 linked to contract #36C24824P0096. As with the previous repair, the quoted labor rate was $630.00 per hour, and with the 12% government discount, the net labor rate came to $554.40 per hour.

Siemens has provided a quote totaling $386,420.00. This amount includes a discounted parts price of $270,494.00, reflecting a 30% discount. Additionally, the quote offers a trade-in discount if a defective part is returned to Siemens, valuing the trade-in at $54,098.80. If the defective part is accepted for trade-in, the overall net cost for the part would decrease to $216,395.20. Taking into account the confirmed parts pricing, the 30% government discount, and the potential trade-in value of $54,098.80, the proposed parts price of $270,494.00 is considered fair and reasonable. The quoted price for the replacement and installation of the X-ray tube is significantly lower than the cost of replacing the entire system, making it a highly cost-effective solution for the government. Labor rates and shipping costs have remained stable since 2023, providing predictability in budgeting. It is important to note that the cost of parts required for repair has been increasing annually due to rising prices and inflation.

8. Description of the Market Research Conducted and the Results, or a Statement of the Reasons Market Research Was Not Conducted: Market research involves inquiries on fdps.gov, sam.gov, and the previous acquisition history of the same or similar services. Our research indicates that there is currently no approved Service- Disabled Veteran-Owned Small Business (SDVOSB) available. Siemens Medical Solutions USA, Inc. can fulfill the needs specified for this procurement of materials, parts, and labor. Due to the urgent and proprietary nature of the requirement, limited market research was conducted. This agency is committed to fostering fair competition in accordance with all procurement regulations. Our policy is to seek full and open competition to the greatest extent possible while meeting the necessary requirements.

However, the proprietary nature of this requirement restricts other vendors from providing support.

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

SIEMENS owns the rights and is the Original Equipment Manufacturer and no other vendors have been found who can obtain the necessary FDA approved repair parts for this type of repair. The equipment is highly specialized and improper maintenance or calibration could cause misdiagnosis or harm to patients. Patient procedures will either need to be cancelled or sent out to other facilities on fee basis until this system can be returned to full operation.

10.Listing of Sources that Expressed, in Writing, an Interest in the Acquisition: On 1/8/2024, SIEMENS provided our office with a Sole Source Letter (SSL) confirming that they are the manufacturer and exclusive distributor for this equipment (P03 Sole Source Letter in eCMS Briefcase). No other vendors can perform the necessary services, obtain FDA-approved parts, or work on the hardware of these Siemens SOMATOM Definition AS 64 radiographic unit . The proprietary nature of this equipment restricts other vendors from being able to provide the complete support these units need.

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

Revision: 03 Effective Date: 04/15/24 Acquisition ID#: 36C248-25-AP-1521 supplies or services required: None.

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.

Jennifer Garcia COR James A. Haley VAMC

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.

Contract NCO 8 - Tampa Division

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

Jose Ortiz-Velez