VA awards $2.5M contract for esophageal cancer predictive assay to Castle Biosciences, Inc

Contract Overview

Contract Amount: $2,500 ($2.5K)

Contractor: Castle Biosciences, Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2023-09-15

End Date: 2024-09-14

Contract Duration: 365 days

Daily Burn Rate: $7/day

Competition Type: NOT COMPETED UNDER SAP

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: CONTRACTOR SHALL PROVIDE FOR A PREDICTIVE BARTLETT ESOPHAGUS ASSAY PBEA WHICH WILL IDENTIFY THE PROBABILITY THAT A PATIENT WILL DEVELOP ESOPHAGEAL CANCER OVER A 5 YEAR PERIOD.

Place of Performance

Location: PALO ALTO, SANTA CLARA County, CALIFORNIA, 94304

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $2,500 to CASTLE BIOSCIENCES, INC for work described as: CONTRACTOR SHALL PROVIDE FOR A PREDICTIVE BARTLETT ESOPHAGUS ASSAY PBEA WHICH WILL IDENTIFY THE PROBABILITY THAT A PATIENT WILL DEVELOP ESOPHAGEAL CANCER OVER A 5 YEAR PERIOD. Key points: 1. Contract focuses on a novel predictive assay for esophageal cancer, a significant public health concern. 2. Sole-source award raises questions about potential cost savings and market innovation. 3. Limited competition may impact price discovery and potentially lead to higher costs for taxpayers. 4. The contract duration of one year suggests a pilot or initial phase for this specific service. 5. The Department of Veterans Affairs is the primary agency procuring this specialized diagnostic service. 6. The service aims to identify patients at high probability of developing esophageal cancer within a 5-year period.

Value Assessment

Rating: questionable

The contract value of $2.5 million for a one-year period for a predictive assay appears to be on the higher end, especially given the limited competition. Without comparable contract data for similar predictive diagnostic services, it is difficult to definitively benchmark the value. However, sole-source awards often carry a premium due to the lack of competitive pressure to drive down prices. Further analysis would be needed to determine if this price reflects fair market value for the technology and services provided.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed under the Simplified Acquisition Procedures (SAP) and was awarded on a sole-source basis. This means that only one vendor, Castle Biosciences, Inc., was solicited for this requirement. The lack of competition limits the government's ability to explore alternative solutions or negotiate the best possible price. It is unclear why this contract was not competed more broadly, which could have potentially led to a more competitive bidding process and better pricing.

Taxpayer Impact: Sole-source awards can result in taxpayers paying more than they would in a competitive environment. The absence of multiple bids means the government may not be benefiting from the most cost-effective solution available in the market.

Public Impact

Veterans diagnosed with or at risk for esophageal conditions will benefit from this advanced diagnostic tool. The service provides a predictive assay to identify individuals with a high probability of developing esophageal cancer. The geographic impact is primarily within the United States, serving the veteran population. This contract supports the development and deployment of innovative healthcare technology within the VA system.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potential cost savings for taxpayers.
Lack of transparency in the sole-source justification could mask inefficiencies.
High per-unit cost is a potential concern without competitive benchmarking.

Positive Signals

Addresses a critical healthcare need for early cancer detection.
Utilizes advanced predictive technology for improved patient outcomes.
Contract awarded to a specialized firm in the biosciences sector.

Sector Analysis

The healthcare sector, specifically diagnostic and laboratory services, is characterized by rapid technological advancement and specialized expertise. This contract falls within the 'Testing Laboratories and Services' NAICS code (541380). The market for predictive diagnostics is growing, driven by advancements in genomics and personalized medicine. Comparable spending benchmarks are difficult to establish without more specific details on the assay's technology and scope, but contracts in this area can range significantly based on complexity and volume.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. The award to Castle Biosciences, Inc., a presumably established entity in the biosciences field, suggests that the focus was on specialized capabilities rather than small business participation. This contract does not appear to directly impact the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Veterans Affairs' procurement and program management offices. Accountability measures would be tied to the delivery of the predictive assay as specified in the contract. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

VA Medical Services Contracts
Diagnostic Testing Services
Cancer Research and Development
Biotechnology Procurement

Risk Flags

Sole-source award may limit price competition.
Lack of transparency in procurement justification.
Potential for higher costs due to lack of competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $2,500 to CASTLE BIOSCIENCES, INC. CONTRACTOR SHALL PROVIDE FOR A PREDICTIVE BARTLETT ESOPHAGUS ASSAY PBEA WHICH WILL IDENTIFY THE PROBABILITY THAT A PATIENT WILL DEVELOP ESOPHAGEAL CANCER OVER A 5 YEAR PERIOD.

Who is the contractor on this award?

The obligated recipient is CASTLE BIOSCIENCES, 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 $2,500.

What is the period of performance?

Start: 2023-09-15. End: 2024-09-14.

What is the specific technology behind the predictive Bartlett Esophagus Assay (PBEA) and how does it work?

The predictive Bartlett Esophagus Assay (PBEA) is designed to identify the probability that a patient will develop esophageal cancer over a 5-year period. While the specific technological details are not provided in the contract data, such assays often leverage biomarkers, genetic markers, or cellular analysis to predict disease risk. For instance, some assays might analyze specific gene mutations associated with esophageal cancer, while others could look for protein expressions or cellular changes in tissue samples. The 'Bartlett' in the name may refer to a specific methodology, researcher, or clinical trial associated with its development. The assay likely involves laboratory analysis of patient samples (e.g., biopsies, blood) to generate a risk score or probability percentage.

Why was this contract awarded on a sole-source basis instead of being competed?

The contract data indicates the award was 'NOT COMPETED UNDER SAP' and is classified as 'sole-source'. Sole-source awards are typically justified when only one responsible source is available or capable of providing the required goods or services. This could be due to unique intellectual property, proprietary technology, specialized expertise, or urgent needs where only one vendor can meet the timeline. For this specific contract, Castle Biosciences, Inc. may possess exclusive rights to the PBEA technology, or they may be the only entity with the validated capability and regulatory approvals to perform this specific type of predictive assay at the required scale and quality for the VA. A formal justification for the sole-source award would normally be documented by the agency.

How does the $2.5 million contract value compare to similar predictive diagnostic services in the market?

Benchmarking the $2.5 million contract value for the PBEA is challenging without more specific market data on comparable predictive diagnostic services. The cost of such assays can vary widely based on the complexity of the technology, the type of sample analyzed (e.g., biopsy vs. blood), the number of biomarkers or genetic markers assessed, and the validation status of the assay. Given that this is a sole-source award for a one-year period, the price may not reflect the most competitive market rate. Typically, competitive procurements allow for price discovery and negotiation, potentially leading to lower costs. Further research into the pricing structures of other advanced diagnostic tests for chronic diseases would be necessary for a more robust comparison.

What are the potential risks associated with a sole-source contract for a critical healthcare service?

Sole-source contracts for critical healthcare services present several potential risks. Firstly, the lack of competition can lead to higher prices for taxpayers, as the government does not benefit from the cost-saving pressures inherent in a competitive bidding process. Secondly, it may limit the government's access to potentially superior or more cost-effective alternative solutions that other vendors might offer. Thirdly, there's a risk of vendor lock-in, where the government becomes dependent on a single provider, potentially reducing leverage in future negotiations. Finally, without competitive scrutiny, there's a diminished incentive for the sole-source provider to innovate or improve efficiency, although quality standards must still be met.

What is Castle Biosciences, Inc.'s track record with government contracts, particularly with the VA?

The provided data does not include information on Castle Biosciences, Inc.'s prior track record with government contracts, including those with the Department of Veterans Affairs. To assess their reliability and performance history, a review of federal procurement databases (like SAM.gov or FPDS) would be necessary to identify previous awards, contract types, values, and any performance evaluations or disputes. Understanding their experience with similar healthcare technology procurements would provide valuable context for this current award.

What are the expected outcomes or performance metrics for this PBEA service?

The contract specifies that the PBEA will 'identify the probability that a patient will develop esophageal cancer over a 5-year period.' Expected outcomes would likely include the accurate and timely delivery of these predictive risk assessments to the VA. Performance metrics would probably focus on the assay's sensitivity, specificity, and predictive accuracy, ensuring it reliably identifies high-risk individuals. Other metrics could include turnaround time for results, adherence to quality control standards, and the successful integration of the assay's findings into patient care pathways within the VA system. The contract's success hinges on the assay's ability to provide actionable information that aids in clinical decision-making and potentially preventative interventions.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Testing Laboratories and Services

Product/Service Code: MEDICAL SERVICES › LABORATORY TESTING SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 505 S FRIENDSWOOD DR STE 401, FRIENDSWOOD, TX, 77546

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

Financial Breakdown

Contract Ceiling: $2,500

Exercised Options: $2,500

Current Obligation: $2,500

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C26121D0108

IDV Type: IDC

Timeline