DOJ's $511K McKesson Contract for FY26 Medications to Federal Prisons

Contract Overview

Contract Amount: $510,928 ($510.9K)

Contractor: Mckesson Corporation

Awarding Agency: Department of Justice

Start Date: 2026-03-01

End Date: 2026-09-30

Contract Duration: 213 days

Daily Burn Rate: $2.4K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: MARCH MCKESSON CONTRACT MEDICATIONS FY26

Place of Performance

Location: IRVING, DALLAS County, TEXAS, 75039

State: Texas Government Spending

Plain-Language Summary

Department of Justice obligated $510,928.44 to MCKESSON CORPORATION for work described as: MARCH MCKESSON CONTRACT MEDICATIONS FY26 Key points: 1. Contract awarded to McKesson Corporation for pharmaceutical preparations. 2. Full and open competition was utilized for this award. 3. The contract duration is 213 days, ending September 30, 2026. 4. This spending supports the Federal Prison System's medication needs.

Value Assessment

Rating: good

The contract value of $510,928.44 appears reasonable for a six-month supply of medications for the Federal Prison System. Benchmarking against similar pharmaceutical contracts would provide further validation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The use of full and open competition suggests a robust price discovery process, allowing multiple vendors to bid. This method is generally expected to yield competitive pricing.

Taxpayer Impact: Taxpayer funds are being used efficiently through a competitive bidding process for essential medications.

Public Impact

Ensures a consistent supply of necessary medications for inmates. Supports the operational needs of the Bureau of Prisons. Contributes to the health and well-being of the incarcerated population.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price fluctuations in pharmaceutical markets.
Dependence on a single supplier for critical medications.

Positive Signals

Competitive award process.
Clear contract duration and delivery period.

Sector Analysis

This contract falls within the Pharmaceutical Preparation Manufacturing sector, which is critical for healthcare services. Spending benchmarks for federal pharmaceutical contracts vary widely based on volume and specific drug types.

Small Business Impact

The data does not indicate if small businesses were involved in this specific contract award. Further analysis would be needed to determine their participation.

Oversight & Accountability

The Bureau of Prisons is responsible for overseeing this contract to ensure timely delivery and quality of medications, with standard federal procurement regulations applying.

Related Government Programs

Pharmaceutical Preparation Manufacturing
Department of Justice Contracting
Federal Prison System / Bureau of Prisons Programs

Risk Flags

Potential for supply chain disruptions.
Price volatility in pharmaceutical markets.
Dependence on a single large supplier.
Ensuring adequate formulary coverage for inmate health needs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $510,928.44 to MCKESSON CORPORATION. MARCH MCKESSON CONTRACT MEDICATIONS FY26

Who is the contractor on this award?

The obligated recipient is MCKESSON CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Justice (Federal Prison System / Bureau of Prisons).

What is the total obligated amount?

The obligated amount is $510,928.44.

What is the period of performance?

Start: 2026-03-01. End: 2026-09-30.

What is the historical pricing trend for similar medication procurements by the Bureau of Prisons?

Analyzing historical pricing data for comparable medication procurements by the Bureau of Prisons is crucial. This would involve comparing the per-unit cost and total contract value against previous awards for similar drug categories and quantities. Understanding these trends helps identify potential cost savings or areas where prices may be increasing due to market factors or inflation, ensuring the current contract represents good value.

What are the risks associated with relying on McKesson Corporation for this medication supply?

Risks include potential supply chain disruptions affecting McKesson, which could impact the availability of critical medications for federal inmates. There's also the risk of price increases in future contract renewals if competition diminishes. Furthermore, dependence on a single large supplier might limit flexibility in sourcing alternative or newer medications if needed.

How effectively does this contract meet the specific pharmaceutical needs of the Federal Prison System?

The effectiveness hinges on the contract's ability to provide the right medications at the right time and in the required quantities. While the contract specifies pharmaceutical preparations, the actual effectiveness depends on the formulary coverage, adherence to delivery schedules, and the quality of the pharmaceuticals supplied. Monitoring delivery performance and inmate health outcomes would provide a clearer picture of effectiveness.

Industry Classification

NAICS: Manufacturing › Pharmaceutical and Medicine Manufacturing › Pharmaceutical Preparation Manufacturing

Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 6555 STATE HIGHWAY 161, IRVING, TX, 75039

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $510,928

Exercised Options: $510,928

Current Obligation: $510,928

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36W79720D0001

IDV Type: IDC

Timeline