VA Awards $2.05M Delivery Contract to UPS for Pharmacy Services

Contract Overview

Contract Amount: $2,050,000 ($2.0M)

Contractor: United Parcel Service CO.

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-07-01

End Date: 2026-09-30

Contract Duration: 456 days

Daily Burn Rate: $4.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Transportation

Official Description: DELIVERY SERVICE FOR PHARMACY WITH UPS

Place of Performance

Location: CHARLESTON, CHARLESTON County, SOUTH CAROLINA, 29401

State: South Carolina Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $2.0 million to UNITED PARCEL SERVICE CO. for work described as: DELIVERY SERVICE FOR PHARMACY WITH UPS Key points: 1. Contract awarded to a single, established provider (UPS). 2. Focus on essential pharmacy delivery services for veterans. 3. Potential for cost savings through established logistics networks. 4. Limited direct competition noted in the award process.

Value Assessment

Rating: good

The contract value of $2.05M for a 456-day period appears reasonable given the specialized nature of pharmacy delivery. Benchmarking against similar government contracts for express delivery services would provide further validation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' suggesting a limited competition approach. This method may impact price discovery compared to a broader, unrestricted competition.

Taxpayer Impact: The use of a single, established provider like UPS aims for efficiency, potentially leading to cost-effectiveness for taxpayers by leveraging existing infrastructure.

Public Impact

Ensures timely delivery of prescription medications to veterans. Supports the Department of Veterans Affairs' healthcare mission. Relies on a well-known logistics provider for service continuity.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may not yield the lowest possible price.
Dependence on a single vendor for critical service.

Positive Signals

Leverages established and reliable delivery infrastructure.
Potential for efficient service delivery due to vendor's scale.

Sector Analysis

This contract falls within the logistics and transportation sector, specifically focusing on courier and express delivery services. Government spending in this area is substantial, driven by the need for efficient movement of goods and services.

Small Business Impact

The contract was not awarded to a small business. There is an opportunity to explore future contracts or subcontracting opportunities within this sector for small businesses specializing in logistics or delivery.

Oversight & Accountability

The Department of Veterans Affairs is responsible for overseeing this contract. Standard oversight mechanisms for delivery services, including performance metrics and delivery confirmations, should be in place.

Related Government Programs

Couriers and Express Delivery Services
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Potential for higher costs due to limited competition.
Sole reliance on one vendor for a critical service.
Lack of direct comparison with other courier services.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $2.0 million to UNITED PARCEL SERVICE CO.. DELIVERY SERVICE FOR PHARMACY WITH UPS

Who is the contractor on this award?

The obligated recipient is UNITED PARCEL SERVICE CO..

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $2.0 million.

What is the period of performance?

Start: 2025-07-01. End: 2026-09-30.

What is the expected impact of using UPS on delivery times and reliability for veteran prescriptions?

Leveraging UPS's extensive logistics network is expected to ensure reliable and timely delivery of veteran prescriptions. Their established infrastructure and tracking capabilities should provide a high degree of service continuity, minimizing disruptions and ensuring medications reach beneficiaries promptly.

How does the 'limited competition' approach affect the overall value for taxpayer dollars in this contract?

While 'limited competition' can sometimes lead to higher prices, in this case, it may have secured a reliable provider with proven capabilities for a critical service. The VA likely assessed that the benefits of using a known entity like UPS outweighed potential price reductions from a broader competition, balancing cost with essential service delivery.

Are there specific performance metrics or service level agreements (SLAs) tied to this contract to ensure effectiveness?

While not explicitly detailed in the provided data, government contracts of this nature typically include stringent performance metrics and Service Level Agreements (SLAs). These would likely cover aspects like on-time delivery rates, package integrity, and responsiveness to issues, ensuring the effectiveness of the delivery service.

Industry Classification

NAICS: Transportation and Warehousing › Couriers and Express Delivery Services › Couriers and Express Delivery Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › ADMINISTRATIVE SUPPORT SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1400 N HURSTBOURNE PKWY, LOUISVILLE, KY, 40223

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

Financial Breakdown

Contract Ceiling: $2,050,000

Exercised Options: $2,050,000

Current Obligation: $2,050,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HTC71123DC025

IDV Type: IDC

Timeline