VA awards $582K for Impella Controller Service, raising questions on competition and value

Contract Overview

Contract Amount: $58,200 ($58.2K)

Contractor: Abiomed Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-05-06

End Date: 2027-05-05

Contract Duration: 729 days

Daily Burn Rate: $80/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: AUTOMATED IMPELLA CONTROLLER SERVICE AGREEMENT

Place of Performance

Location: CLEVELAND, CUYAHOGA County, OHIO, 44106

State: Ohio Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $58,200 to ABIOMED INC for work described as: AUTOMATED IMPELLA CONTROLLER SERVICE AGREEMENT Key points: 1. Contract awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. Limited competition suggests a lack of market alternatives or a strategic decision by the agency. 3. The duration of the contract (729 days) indicates a long-term need for this specific service. 4. Focus on repair and maintenance for specialized medical equipment highlights critical healthcare infrastructure. 5. The award to a single vendor may indicate a reliance on proprietary technology or specialized expertise.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to the sole-source nature and lack of publicly available comparable pricing. The fixed-price structure provides some cost certainty, but without competitive bids, it's difficult to ascertain if the $582,000 price represents optimal value for money. The agency's reliance on a single vendor for this critical equipment service warrants scrutiny to ensure fair pricing and prevent potential overspending.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a sole-source justification, meaning it was not competed among multiple vendors. This approach is typically reserved for situations where only one vendor can provide the required goods or services, often due to proprietary technology, unique expertise, or urgent needs. The lack of competition limits the agency's ability to leverage market forces to achieve the best possible price.

Taxpayer Impact: Taxpayers may be paying a premium for this service due to the absence of competitive bidding. Without multiple offers, there is less pressure on the contractor to offer the most cost-effective solution.

Public Impact

Veterans receiving care at VA facilities will benefit from the continued availability of functional Impella devices. Ensures the operational readiness of critical cardiac support technology within the Department of Veterans Affairs. The service impacts healthcare delivery in Ohio, where the contract is managed. Supports specialized biomedical technicians and engineers involved in the maintenance of advanced medical equipment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure, potentially leading to higher costs for taxpayers.
Lack of transparency in pricing due to no competitive bidding process.
Potential for vendor lock-in if alternative service providers are not viable.
Dependence on a single supplier for critical medical equipment maintenance.

Positive Signals

Ensures continued availability of essential medical equipment for veteran care.
Fixed-price contract provides cost predictability for the agency.
Specialized service likely requires unique technical expertise, justifying a single vendor in some cases.

Sector Analysis

The medical device repair and maintenance sector is a critical component of the healthcare industry, ensuring the functionality of advanced diagnostic and therapeutic equipment. This contract falls within the broader category of healthcare services and equipment support. Spending in this area is driven by the need to maintain sophisticated technology, often with high upfront costs and specialized maintenance requirements. Comparable spending benchmarks are difficult to establish without more specific details on the Impella controller model and service scope.

Small Business Impact

This contract does not appear to have a small business set-aside. The award to ABIOMED INC, a specialized medical device company, suggests a focus on technical expertise rather than broad market competition. There is no explicit indication of subcontracting opportunities for small businesses within this specific award notice.

Oversight & Accountability

The Department of Veterans Affairs (VA) is responsible for overseeing this contract. Oversight mechanisms would typically include contract performance monitoring, invoice review, and adherence to the terms and conditions of the purchase order. Transparency is limited due to the sole-source nature of the award. The VA Office of Inspector General (OIG) could investigate this contract if concerns regarding waste, fraud, or abuse arise.

Related Government Programs

Medical Equipment Maintenance Services
Cardiac Assist Devices
Veterans Health Administration Procurement
Sole Source Justifications

Risk Flags

Sole Source Award
Lack of Competition
Potential for Overpricing
Vendor Lock-in Risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $58,200 to ABIOMED INC. AUTOMATED IMPELLA CONTROLLER SERVICE AGREEMENT

Who is the contractor on this award?

The obligated recipient is ABIOMED INC.

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 $58,200.

What is the period of performance?

Start: 2025-05-06. End: 2027-05-05.

What is the specific model of the ABIOMED Impella controller being serviced under this agreement, and what are the key maintenance tasks included?

The provided data does not specify the exact model of the ABIOMED Impella controller. However, the service agreement likely covers routine maintenance, calibration, troubleshooting, and repair of the controller unit, which is a critical component of the Impella heart pump system. This system is used to temporarily assist or replace the pumping function of the heart. The scope of work would typically be detailed in the contract's statement of work, outlining preventative maintenance schedules, response times for service calls, and parts replacement procedures. Without the full contract details, the precise services remain generalized.

Why was this contract awarded on a sole-source basis, and what alternatives were considered by the Department of Veterans Affairs?

The contract was awarded on a sole-source basis, indicated by 'NOT COMPETED' in the data. This typically occurs when the agency determines that only one responsible source can provide the required supplies or services. Reasons for sole-sourcing often include proprietary technology, unique capabilities, or urgent and compelling needs where competition is not feasible or would result in unacceptable delays or costs. The VA would have had to document a justification for this sole-source award, outlining why other vendors could not meet the requirement. This documentation is usually available upon request under freedom of information laws, but is not present in the provided summary data.

How does the $582,000 contract value compare to historical spending on similar Impella controller service agreements by the VA or other federal agencies?

Direct comparison of the $582,000 contract value to historical spending is difficult without access to a broader dataset of similar contracts. The duration of this contract is 729 days (approximately 2 years). If this represents the total cost over two years, the annual cost would be around $291,000. Benchmarking would require identifying other VA or Department of Defense contracts for the maintenance of Impella controllers or comparable advanced cardiac support devices, noting their duration, scope of services, and pricing structures. Given the specialized nature of this equipment and the sole-source award, this figure might be within a reasonable range for such services, but without comparative data, it's hard to definitively assess value for money.

What are the potential risks associated with relying on a single vendor for the maintenance of critical medical equipment like the Impella controller?

Relying on a single vendor for critical medical equipment maintenance presents several risks. Firstly, it can lead to higher costs due to a lack of competitive pricing pressure. Secondly, it creates a dependency that can be problematic if the vendor experiences financial difficulties, changes its business strategy, or faces supply chain disruptions. Thirdly, the agency may have less leverage in negotiating service level agreements or addressing performance issues. Finally, if the vendor's technology becomes obsolete or unsupported, the agency might face significant challenges in transitioning to a new system or provider.

What is ABIOMED INC's track record with the federal government, particularly with the Department of Veterans Affairs, for providing similar services?

ABIOMED INC is a known manufacturer of medical devices, including the Impella heart pump system. Their track record with the federal government, particularly the VA, would likely involve previous contracts for the purchase of these devices and potentially for their maintenance and service. A deeper dive into federal procurement databases (like FPDS or SAM.gov) would reveal the extent and nature of their past awards. Given that this is a sole-source award for service, it suggests a pre-existing relationship or a recognized expertise that the VA relies upon. Information on past performance ratings and any disputes or contract terminations would provide further insight into their reliability.

Industry Classification

NAICS: Other Services (except Public Administration) › Electronic and Precision Equipment Repair and Maintenance › Electronic and Precision Equipment Repair and Maintenance

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 36C25025Q0510

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Johnson & Johnson

Address: 22, CHERRY HILL DRIVE, DANVERS, MA, 01923

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

Financial Breakdown

Contract Ceiling: $145,500

Exercised Options: $58,200

Current Obligation: $58,200

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline