VA awards $68.5M contract for radiopharmaceuticals to Hot Shots NM LLC, a non-competed delivery order

Contract Overview

Contract Amount: $68,454 ($68.5K)

Contractor: HOT Shots NM LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2023-10-01

End Date: 2024-09-30

Contract Duration: 365 days

Daily Burn Rate: $188/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: IDIQ NON PET RADIOPHARMACY UNIT DOSES-IC

Place of Performance

Location: DAVENPORT, SCOTT County, IOWA, 52807

State: Iowa Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $68,453.93 to HOT SHOTS NM LLC for work described as: IDIQ NON PET RADIOPHARMACY UNIT DOSES-IC Key points: 1. The contract value of $68.5 million for radiopharmaceuticals represents a significant investment in patient care. 2. The sole-source nature of this award raises questions about potential price efficiencies and market competition. 3. The fixed-price contract type offers some cost certainty, but the lack of competition limits benchmarking opportunities. 4. The contract duration of one year suggests a need for ongoing supply and potential for future awards. 5. The pharmaceutical preparation manufacturing sector is critical for healthcare delivery, especially for diagnostic and therapeutic agents.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the lack of publicly available comparable contract data for similar radiopharmaceutical supplies under sole-source awards. The fixed-price nature provides some cost control, but without competitive bidding, it's difficult to ascertain if the pricing reflects optimal value for money. The total award amount of $68.5 million warrants scrutiny to ensure it aligns with market rates for these specialized pharmaceutical products.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Hot Shots NM LLC, was considered. This approach bypasses the standard competitive bidding process, which typically involves multiple vendors submitting proposals. While sole-source awards can be justified in specific circumstances, such as unique capabilities or urgent needs, they limit the government's ability to explore a wider range of pricing and service options. The absence of competition means taxpayers do not benefit from the price discovery mechanisms inherent in a robust bidding environment.

Taxpayer Impact: The lack of competition means taxpayers may not be receiving the best possible price for these essential radiopharmaceuticals. Without competing bids, there is less pressure on the contractor to offer the most cost-effective solution.

Public Impact

Veterans receiving diagnostic and therapeutic treatments will benefit from the reliable supply of radiopharmaceuticals. The contract ensures the availability of critical pharmaceutical preparations for medical imaging and treatment. The geographic impact is primarily within the facilities served by the Department of Veterans Affairs, potentially nationwide. The contract supports the pharmaceutical manufacturing workforce involved in the production and distribution of these specialized drugs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher prices than a competitively sourced contract.
Sole-source awards can limit innovation by not engaging with a broader market of suppliers.
Dependence on a single supplier could pose a risk if the supplier faces production or delivery issues.

Positive Signals

The contract ensures a consistent supply of essential radiopharmaceuticals for veteran healthcare.
The fixed-price contract provides a degree of budget certainty for the VA.
The award supports a critical segment of the healthcare supply chain.

Sector Analysis

The market for radiopharmaceuticals is a specialized segment within the broader pharmaceutical industry, characterized by high research and development costs, stringent regulatory requirements, and a need for specialized manufacturing and distribution capabilities. The global radiopharmaceutical market is valued in the billions of dollars and is driven by advancements in nuclear medicine for diagnostics and therapeutics. This contract fits within the healthcare sector, specifically supporting the VA's medical supply chain for nuclear medicine services.

Small Business Impact

This contract does not appear to have a small business set-aside. The award to Hot Shots NM LLC, a single entity, does not provide direct subcontracting opportunities for small businesses through a set-aside mechanism. The impact on the small business ecosystem is neutral in terms of direct set-aside benefits, though Hot Shots NM LLC may engage small businesses as suppliers or subcontractors independently.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs' contracting and program management offices. Accountability measures are typically embedded in the contract terms and conditions, including performance standards and delivery schedules. Transparency is limited by the sole-source nature of the award, as detailed justifications and competitive analyses are not publicly disseminated. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Department of Veterans Affairs Medical Supplies
Pharmaceutical Manufacturing Contracts
Radiopharmaceutical Procurement
Nuclear Medicine Services Contracts

Risk Flags

Sole-source award bypasses competitive process
Limited transparency on pricing and value
Potential for higher costs due to lack of competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $68,453.93 to HOT SHOTS NM LLC. IDIQ NON PET RADIOPHARMACY UNIT DOSES-IC

Who is the contractor on this award?

The obligated recipient is HOT SHOTS NM LLC.

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 $68,453.93.

What is the period of performance?

Start: 2023-10-01. End: 2024-09-30.

What is the track record of Hot Shots NM LLC in supplying radiopharmaceuticals to federal agencies?

Information regarding the specific track record of Hot Shots NM LLC in supplying radiopharmaceuticals to federal agencies is not readily available in the provided data. As this is a sole-source award, it suggests that either the agency has prior positive experience with this contractor, or the contractor possesses unique qualifications or capabilities deemed essential. Further investigation into the contractor's past performance, including any previous contracts with the VA or other federal entities, would be necessary to fully assess their reliability and expertise in this specialized field. Without this historical data, the assessment of their track record remains incomplete.

How does the pricing of this contract compare to similar radiopharmaceutical procurements?

Direct comparison of pricing for this $68.5 million contract is difficult due to its sole-source nature and the specialized product category. Typically, competitive bidding allows for price benchmarking against multiple offers. Without comparable sole-source awards or publicly available pricing data for similar radiopharmaceutical unit doses from other suppliers, it's challenging to determine if the price paid by the VA is optimal. The fixed-price contract type offers some predictability, but the absence of competition means the government cannot leverage market dynamics to secure potentially lower prices. A thorough value analysis would require access to market research and potentially cost breakdowns from the contractor.

What are the primary risks associated with a sole-source award for critical pharmaceuticals?

The primary risks associated with a sole-source award for critical pharmaceuticals like radiopharmaceuticals include potential overpayment due to lack of price competition, reduced incentive for the contractor to innovate or improve efficiency, and supply chain vulnerability if the single supplier experiences disruptions. There's also a risk of vendor lock-in, making it difficult to switch suppliers in the future. Furthermore, the absence of a competitive process can limit the agency's ability to explore alternative products or formulations that might offer better value or efficacy. Robust contract management and performance monitoring are crucial to mitigate these risks.

What is the expected effectiveness of this contract in ensuring the availability of radiopharmaceuticals for veterans?

This contract is expected to be effective in ensuring the availability of radiopharmaceuticals for veterans, as it directly procures these essential medical supplies. The fixed-price delivery order structure aims to provide a predictable supply chain for the Department of Veterans Affairs. The effectiveness hinges on the contractor's ability to consistently meet delivery schedules and quality standards. Given the critical nature of radiopharmaceuticals in diagnosis and treatment, a reliable supply is paramount for patient care. The one-year duration suggests an ongoing need, and successful execution of this order would likely lead to future requirements.

What are the historical spending patterns for radiopharmaceuticals by the Department of Veterans Affairs?

Historical spending patterns for radiopharmaceuticals by the Department of Veterans Affairs are not detailed in the provided data. However, the award of a $68.5 million contract indicates a significant and ongoing requirement for these products. Federal agencies, particularly those with large healthcare networks like the VA, typically have substantial budgets allocated for pharmaceuticals. Understanding past spending would involve analyzing historical contract awards for similar products, identifying trends in volume, pricing, and supplier diversity over several fiscal years. This analysis would help contextualize the current award and identify potential shifts in procurement strategy or market dynamics.

What specific types of radiopharmaceuticals are covered under this contract?

The contract ID is 'IDIQ NON PET RADIOPHARMACY UNIT DOSES-IC', and the NAICS code is '325412' (Pharmaceutical Preparation Manufacturing). This suggests the contract covers the supply of unit doses of radiopharmaceuticals, likely for use in Positron Emission Tomography (PET) scans and potentially other nuclear medicine imaging or therapeutic applications. However, the specific list of individual radiopharmaceutical products, their formulations, and dosages are not detailed in the provided summary data. These specifics would typically be outlined in the contract's statement of work or delivery schedules.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2017 E KIMBERLY RD, DAVENPORT, IA, 52807

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $68,454

Exercised Options: $68,454

Current Obligation: $68,454

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C26320D0034

IDV Type: IDC

Timeline