J&A_Redacted.pdf

Control No: JA17135

“For Official Use Only”

Justification and Approval for Other Than Full and Open Competition for iCRco, Inc. QPC XScan Software and Laptops and Related Repair Parts

1. Contracting Activity: The contracting activity for this action is the U.S. Army Medical Research Acquisition Activity (USAMRAA) in support of the U.S. Army Medical Materiel Agency (USAMMA), 693 Neiman Street, Fort Detrick, MD 21702. The delivery location for the required items will be a USAMMA Medical Maintenance Operations Division Depot located in Tracy, California.

2. Description of Action: This approval is being requested to award a new Firm-Fixed Price non-commercial supply Purchase Order for software manufactured by Image Capture Review Company (iCRco), Inc. preloaded onto Dell laptops required for Computed Radiography (CR) readers requiring repair. This purchase will also include the eight (8) medical equipment repair parts summarized in Table 1 below (see the following page). The estimated total value for this purchase is . One year FY2017 Operations and Maintenance, Army (OMA) funds have been provided for this requirement.

3. Description of Supplies/Services: This is a customized purchase requirement for laptops installed with QPC XScan software. These laptops will be utilized as part of the CR readers by triage medical units as portable standalone medical equipment in the field. These computers, which are part of the larger system of the CR reader, cannot operate off the Windows 7 Operating System commonly found on Dell Latitude 14 Rugged Extreme notebooks (7404 XFR CTO). Rather, in order to integrate with existing medical operating systems, the laptops need to be loaded with proprietary software only available from iCRco, Inc. As part of an integrated medical equipment system in the field, the laptops require iCRco dongle-less version of Department of Defense (DoD) XScan, 64 bit installation, drivers, and configuration of DoD XScan software (QPC XScan 32 v. 2.10, Build 853, DoD Release) to operate independently for image capture, review, and transmission. This is not a standard commercial Information Technology (IT) purchase but is classified as medical equipment by USAMMA because the laptops are an integrated part of the triage mobile unit’s image, capture, and review process and serve as an integrated part of the medical system network and the medical equipment it supports. The laptop computers with the pre-loaded proprietary software are purchased directly from iCRco, Inc. Together, the laptop and software will be used as part of the Vertx CR scanner with single plate image capture and therefore serve as replacements to the existing IT hardware and software that is not properly functioning or otherwise need replaced.

In addition to the IT items summarized above, USAMMA requires repair parts for the CR readers requiring equipment repairs. Parts from the Original Equipment Manufacturer (OEM) must be purchased for these repairs in order to adhere to Army and Food and Drug Administration (FDA) regulations. Specifically, Army Regulation (AR) 40-61, Medical Logistics Policies, prohibits modifications or alterations of Army

Inc., 26 Coromar Drive, Goleta, CA 93117 as this is the only available source for all required items listed in the table above.

6. Efforts to Obtain Competition: USAMRAA has issued multiple Purchase Orders for commercial (non-IT) parts manufactured by iCRco, Inc. in the past. For these previous Orders, which were issued on a brand name only basis, the Government was able to locate third party resellers that are authorized by the OEM, such as Tryco, Inc. to sell its products. However, based on direct communication with , Global Sales Manager, on 14 July 2016 and again on 17 April 2017, this proprietary software can only be sourced directly from iCRco, Inc. and will not be made available through any of the OEM’s resellers.

As required by USAMRAA policy, a Request for Information (RFI) was posted to FedBizOpps on 4 April 2017 to seek information from sources expressing interest in this acquisition. No responses were received from interested sources as of the closing date of 10 April 2017. An additional posting has been made under solicitation number W81XWH-17-R-0022 in accordance with FAR 5.201 and serves as a notice of intent to purchase these items on a sole source basis.

7. Actions to Increase Competition: USAMMA conducts online research as part of its periodic market research efforts to locate other available sources that are capable of meeting these types of requirements in the future. Additionally, the Government may post an updated RFI for any future procurement to determine if there are sources available in the market place that can meet the Government’s need. If the RFI shows there are competitors in the market place, future acquisitions may be competed.

8. Market Research: Thorough market research has been completed by both USAMMA and USAMRAA for the requiring activity’s ongoing need for medical equipment repair and replacement parts. The recent market research efforts include searches on General Services Administration (GSA) Advantage!; a review of previous purchases for similar items, and direct communication with the Global Sales Manager at iCRco, Inc.

Similar requirements that were awarded for laptops loaded with XScan software (Purchase Order numbers W81XWH-15-P-0336 and W81XWH-16-C-0156) were reviewed as part of the market research efforts for this requirement. As part of this review, the previous RFI postings (W81XWH-15-T-0155 and W81XWH-16-T-0343) were reviewed as the purpose of these postings was to ascertain whether there are any alternative sources in the open market that could provide the brand name or equal parts to satisfy USAMMA’s need for this software needed as part of the CR reader. However, no responses were received by the previous Contract Specialists in response to these postings. As the July 2016 RFI posting (W81XWH-16-T-0343) is within the last 18 months, this is considered to be current market research for the subject requirement, in accordance with FAR 10.002(b)(1). Furthermore, combined with the RFI posting for this requirement, under solicitation number W81XWH-17-R-0022, the market research supports the sole source nature of this proprietary software.

Market research documented within the contract file for W81XWH-16-C-0156 includes direct email correspondence with , Global Sales Manager at iCRco, Inc., confirming that, although the company works with multiple third party resellers/ distributors that are authorized vendors for this OEM, the XScan software is not distributed or sold by any other vendors but rather is only sourced directly through iCRco, Inc. More recent email and telephonic communications with M confirmed that the proprietary software is still only available directly from iCRco, Inc.

However, this communication also revealed that iCRco, Inc. filed Chapter 11 bankruptcy in order to reorganize under the bankruptcy laws of the United States. The company filed for bankruptcy under Chapter 11 on 21 September 2016 under the California Central Bankruptcy Court. In an email from M on 17 April 2017, the Global Sales Manager informed the CS that iCRco, Inc. won a major hearing in court earlier this month and, therefore, will be resuming normal operations allowing the manufacturer to fulfill the required order.

Additional market research was conducted on 4 April 2017 for this requirement.

Specifically, the Contract Specialist completed searches on GSA Advantage for the specific software identified in Table 1. This search revealed no results. The Contract Specialist also searched GSA eLibrary to determine if the manufacturer has a GSA contract. In addition to this search (which also revealed no results), direct correspondence with M confirmed that iCRco, Inc. does not have a GSA contract. Therefore, the Contract Specialist has determined that these items are only available through the open market.

Finally, as previously stated, a RFI was posted to FedBizOpps on 4 April 2017 to seek information from interested sources that may be able to meet the requirements of this purchase. No responses were received in response to the RFI.

9. Interested Sources: In accordance with FAR 5.201, a Notice of Intent to Sole Source was published to FedBizOpps on 26 April 2017 under solicitation number W81XWH-17-R-0022. This announcement will detail the Government’s intent to purchase the required items on a non-competitive basis, directly from the manufacturer.

Any responses received will be reviewed for the purpose of determining whether a competitive procurement is in the best interest of the Government.

The Government does not anticipate any actions that the agency could take to remove or overcome any barriers that led to the restricted consideration before any subsequent supplies are made.

10. Other Facts:

a. Procurement history.

(1) Contract numbers and dates of the last several contracts for these same requirements: As previously stated, similar Orders have been issued directly to iCRco, Inc. by USAMRAA for the XScan software and laptops. The Purchase Order numbers, award dates, and total contract values are as follows:

W81XWH-15-P-0336, awarded on 7 Aug 2015 in the amount of $431,025.10

W81XWH-16-C-0156, awarded on 13 Sep 2016 in the amount of $357,011.86

(2) Competitive status of these actions: These Purchase Orders were accomplished on a sole source basis and awarded directly to iCRco, Inc.

(3) Authority previously used for less than full and open competition: The authority cited for other than full and open competition was FAR 6.302-1(a)(2). The J&A control numbers are JA15179 and JA16290.

(4) If a justification was prepared to support the procurement made before this one, a summary of the contents of paragraph 7 of the justification for that procurement and an explanation of the results: Paragraph 7 for these previous J&As stated that market research efforts will be relied upon in the future to attempt to locate other available sources that are capable of meeting these types of requirements. Additionally, this paragraph stated that an RFI may be posted in the future, which has been undertaken for the current requirement, as detailed above.

This document details the recent market research efforts completed for this new purchase. However, based on the results of this market research to include direct communication with the manufacturer, the specifics regarding the purchase of this software have not changed compared with the previous purchases. The QPC XScan software is still the required software needed for the repair of the CR readers, which is only available from the OEM directly.

(5) If any prior award was accomplished by full and open competition, include a detailed explanation of the changed circumstances causing this action to now limit the sources: Not applicable

(6) An explanation of any unusual patterns which may be revealed by the history, e.g., several consecutive, urgent buys: No unusual patters were found.

(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: As stated under paragraph 8 above, based on recent market

Government Cost Estimate in accordance with FAR 15.404-1(b)(2)(v). Certified Cost or Pricing data will not be required as the estimated value does not meet or exceed the threshold of $750,000.00 defined in FAR Part 15.403-4(a)(1).

Typed Name: ___ Date: ____

Title: ______Contracting Officer Signature:

14. Contracting Officer Certification:

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

Typed Name: _ Date: ___

Title: ____Contracting Officer___ Signature: