A03_Sole_Source_Justification_and_Approval_revised_26_April_Redacted.pdf

Control: JA-TEN-17-405 Thermo Electron North America, LLC

Service: PM&R

Justification Review Document For Other Than Full And Open Competition

Program: Preventative Maintenance & Repair Services of Various Thermo Electron (Thermo Fisher Scientific) Equipment & Associated Parts

Authority: Simplified Procedures for Certain Commercial Items, 41 U.S.C. 1901 as implemented by FAR Subpart 13.5.

Amount: $478,838.00

Prepared by: Amy DuBree DSN: 848-4743 Contract Specialist Date: 26 April 2017 Amy.c.dubree2.civ@mail.mil

Contracting Officer: Sherry Compton DSN: 848-4832 Contracting Officer Date: 26 April 2017 Sherry.l.compton.civ@mail.mil

Technical:

Requirements:

Reviews: I have reviewed this justification and find it adequate to support sole source.

Program Manager:

Justification And Approval For Other Than Full And Open Competition

1. Contracting Activity: U.S. Army Contracting Command, Aberdeen Proving Ground (ACC- APG), Tenant Contracting Division, 6001 Combat Drive, Aberdeen Proving Ground, Maryland 21005

2. Description of Action: The Edgewood Chemical, Biological and Engineering Command (ECBC) requests a Firm-Fixed Price (FFP) contract for repair, preventative maintenance, software upgrades, and technical support for Thermo Electron equipment on the basis of other than full and open competition pursuant to 41 U.S.C. 1901 as implemented by FAR Subpart 13.106-1(b)(2). The total value of this requirement is $478,838.00 to include a base, one (1) option year and a six (6) month option. The base year amount is $158,300.00, option year one amount is $162,257.00, and the six (6) month option amount is $70,845.50. This requirement will be funded with Research, Development, Test & Evaluation (RDT&E) Fiscal Year (FY) 2017 funds. The anticipated award date is 21 May 2017. An acquisition plan is not required because this procurement does not meet the threshold at Defense Federal Acquisition Regulation Supplement 207.103(d)(i)(B).

This action is a follow-on to contract W91ZLK-14-P-0224. That contract was not competed under authority 41 U.S.C. 1901 as implemented by FAR Subpart 13.106-1(b)(2).

3. Description of Supplies/Services:

a. Thermo Electron North American, LLC shall provide resources to manage, operate and control functional areas necessary to provide the following services to the Edgewood Chemical, Biological and Engineering Command (ECBC): unlimited on-site repairs, yearly preventative maintenance, software upgrades, on-line technical support and telephone assistance to resolve technical problems. The work described herein shall be performed primarily at Edgewood Chemical Biological Center (ECBC), Aberdeen Proving Ground (APG), Maryland. North American Industry Classification System (NAICS) code for this action will be 811219, Other Electronic and Precision Equipment Repair and Maintenance.

b. The Requiring Activity is ECBC.

c. The initial Period of Performance is intended for 21 May 2017 to 20 May 2018, estimated at a value of $158,300.00. The total value, inclusive of base plus one one-year option is $320,558.00.

1. One one-year option will be included. Option Year 1 is estimated at a value of

$162,257.00. The value of the option will be evaluated during the initial evaluation prior to contract award and prior to option exercise, should the Government determine it to be within its best interests.

2. FAR 52.217-8, Option to Extend Services will be included in this contract to preclude the necessity for later noncompetitive actions if the follow-on is delayed and / or if a phase-in/phase-out period is required. The inclusion of FAR 52.217-8 will allow services to be extended up to 6 months, at the rates specified in the contract. Based on the Independent Government Estimate (IGE), should the option to extend services be exercised for the full 6 months, the additional cost should be no more than $70,845.50 with a period of performance from 21 May 2018 to 20 November 2018.

3. Authority Cited: Simplified Procedures for Certain Commercial Items, 41 U.S.C.

1901 as implemented by FAR Subpart 13.106-1(b)(2).

4. Reason for Authority Cited:

a. Thermo Electron North America, LLC is the proposed sole-source contractor, 1400 Northpoint Pkwy Suite 50, West Palm Beach, FL 33407-1976, CAGE Code: 3WXJ7.

b. Background: In 1995, the Government contracted with a small business (Laboratory

Service Inc.) for similar services, but the company was ultimately unable to repair two Mass Spectrometer (MS) systems. As a result of ECBC’s requirement to meet the emerging needs to analyze critical samples from the war on terror, only Thermo Electron was determined to be capable of satisfying these requirements. Previously, other businesses, including small business concerns (represented by Unity Labs, which includes dionex, nicolet and biolabs), capable of performing the required services were available, but have since been purchased by Thermo Electron and incorporated into their service division, leaving no other qualified source with the requisite training and knowledge necessary to successfully service the proprietary equipment.

Software upgrades necessary to maintain the equipment in a properly functioning manner is only available from Thermo Electron. For the past four (4) years, several small businesses were contacted to determine their capabilities. These vendors, to include GenTech Scientific, Integrated Service Solutions, Full Spectrum Analytics, and GSS Scientific, acknowledged their lack of capabilities to adequately service the instrumentation. No other businesses capable of performing these services have been located to date.

c. Alternatives: Other companies exist that are able to provide general maintenance and repair services. However, these alternatives are unacceptable to the Government as no other companies have the requisite training needed to successfully perform the services on the Thermo Electron equipment currently owned by ECBC due to its proprietary nature. Utilizing inexperienced service providers significantly increases the risk of damage to the equipment, rendering the Government’s investment, purchased over several years by multiple contracts with Thermo valued at over $2,126,000.00, in the MS, Autosamplers, and associated components null and void.

d. Justification

1. The current equipment requiring maintenance and repair services were manufactured by Thermo Fischer Scientific. Services for the proprietary equipment are only available through one of its subsidiaries, Thermo Electron North America, LLC. Thermo Scientific’s trained technicians are provided through their Unity Lab Services department (5225 Verona Road, Building 5, Madison, WI 53711). Only Thermo Electron trained technicians are qualified to perform this maintenance, due to the proprietary nature of the equipment. Repairs performed by others will void warranties and negatively impact instrument performances and work schedules. If the Government were to proceed with another company other than Thermo Electron, the warranties in place with Thermo Electron would be voided. The estimated cost for repairs of $512,772.00 per year to include replacement costs for damages components due to inexperience, compared to approximately $150,000 with Thermo Electron, will exceed the cost of the proposed service contract with Thermo Electron. Using an inexperienced and untrained company will put the Government’s investment at a high risk of damage.

2. Competition would not have been more feasible had more time been available as the decision to solicit the necessary services from only one source was driven by the inability of other companies to have the requisite training and knowledge to successfully perform maintenance and repair services on the proprietary Thermo Scientific equipment.

3. The required services were previously acquired from Thermo Electron under Contract W91ZLK-14-P-0224, which was awarded in the amount of $257,614.00. The period of performance is from 21 May 2014 until 20 May 2017. Thus, this proposed contract is a continuation by the same contractor, necessary for the reasons stated above. Alternate services are not feasible as it will put the Government’s investment as risk.

4. The equipment is necessary for the analysis of Chemical Weapons of Mass Destruction based on time sensitive schedules provided by ECBC and/or other Defense departments. ECBC receives war fighter samples from around the world. The results determine the in-theater (war zone) collective protection counter measure, which must be taken by the soldier to prevent exposure and/or death from chemical and biological threats. These samples are not received on any consistent schedule; therefore the equipment must be ready at all times to perform analyses upon sample arrival. Unfortunately, if these requirements are not met, our inability to respond could result in catastrophic mission failure and or death of our service members, or adverse and significant degradation of our force protection measures.

6. Efforts to Obtain Competition: Market Research was used to determine if other capable sources existed to support competition. Due to the proprietary nature of this requirement, there are no other sources that can satisfy this requirement, thus competition for this action is not possible. Thermo Electron provided a Proprietary Letter dated 13 April 2017, stating “Thermo Fisher Scientific is the sole source equipment manufacturer and service provider for all Thermo Fisher Scientific instruments, parts, training, technical support, field service support, and software.” The Contracting Officer shall publish the notice required by FAR 5.201.

7. Actions to Increase Competition: In the future, the Government will continue to conduct Market Research to see if other vendors are capable of performing the services by receiving the requisite training. Additionally, when it is time to purchase replacement equipment, the Government will seek equipment that does not have proprietary concerns, if available to meet the specifications.

8. Market Research:

Market Research was conducted within the past six months in accordance with FAR Part 10 policies and procedures. ECBC contacted several alternate companies to include GenTech Scientific, Integrated Service Solutions, Full Spectrum Analytics, and GSS Scientific. ECBC was able to determine that these companies cannot service the full list of equipment which needs to be serviced by this requirement. Thermo Electron provided a Proprietary Letter dated 13 April 2017, stating “Thermo Fisher Scientific is the sole source equipment manufacturer and service provider for all Thermo Fisher Scientific instruments, parts, training, technical support, field service support, and software.” A search on GSA Advantage provided options for purchasing new equipment, but not supporting Preventative Maintenance & Repair (PM&R).

9. Interested Sources: Notice of Intent to Sole Source will be published under FAR 5.203(a)(2), under FAR 12.603.

10. Other Facts:

Procurement History

1. Contract W91ZLK-14-P-0224 was awarded to Thermo Electron North America, LLC as a sole source requirement pursuant to FAR 13.106-1(b)(1) in the amount of $257,614.00. The period of performance is from 21 May 2014 – 20 May 2017.

2. Contract W91ZLK-11-P-0005 was awarded to Thermo Electron North America, of $74,735.00 .The period of performance 1 October 2010 – 30 September 2011.

3. Contract W91ZLK-11-P-0711 was awarded to Thermo Electron North America, of $119,319.00. The period of performance 1 October 2011 – 30 September 2012.

11. Technical Certification:

I certify that the supporting data under my cognizance which is included in this J&A is accurate and complete to the best of my knowledge and belief.

12. Requirements Certification:

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

13. Fair and Reasonable Price Determination:

I hereby determine that the anticipated price to the Government for this contract action will be fair and reasonable based on price analysis, to include comparison of the Independent Government Evaluation (IGE) and technical evaluation.

As a part of this basis, certified cost or pricing data is not required because the item and/or services being acquired are considered commercial and the amount does not meet the dollar threshold for certified cost or pricing data in accordance with FAR 15.403-1(c)(3).

X Sherry Compton Procurring Contracting Officer

14. Contracting Officer Certification:

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

X Sherry Compton Procurring Contracting Officer