HHS awards $2.38M for medical supplies to McKesson Corporation for Pinon Health Center

Contract Overview

Contract Amount: $2,385,444 ($2.4M)

Contractor: Mckesson Corporation

Awarding Agency: Department of Health and Human Services

Start Date: 2024-08-30

End Date: 2026-08-09

Contract Duration: 709 days

Daily Burn Rate: $3.4K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: FSS PHARMACEUTICAL, MEDICAL, AND SURGICAL SUPPLIES FOR PINON HEALTH CENTER

Place of Performance

Location: CHINLE, APACHE County, ARIZONA, 86503

State: Arizona Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $2.4 million to MCKESSON CORPORATION for work described as: FSS PHARMACEUTICAL, MEDICAL, AND SURGICAL SUPPLIES FOR PINON HEALTH CENTER Key points: 1. McKesson Corporation, a major player, secured this contract. 2. The contract is for pharmaceutical, medical, and surgical supplies. 3. The award is a delivery order under a larger contract. 4. The total value is $2,385,444.11 over 709 days. 5. The contract is firm-fixed-price, indicating price certainty.

Value Assessment

Rating: good

The firm-fixed-price contract provides cost certainty. Benchmarking against similar large-scale medical supply contracts would offer further insight into value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a competitive bidding process that likely drove price discovery.

Taxpayer Impact: The competitive award aims to ensure taxpayer funds are used efficiently for essential health supplies.

Public Impact

Ensures critical medical and surgical supplies reach the Pinon Health Center. Supports healthcare services for the community served by the Indian Health Service. Reliable supply chain for pharmaceuticals is crucial for patient care.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Positive Signals

Full and open competition utilized.
Firm fixed price contract type.
Essential healthcare supplies procured.

Sector Analysis

This contract falls within the Healthcare sector, specifically focusing on medical supplies. Spending in this area is consistently high due to ongoing healthcare needs.

Small Business Impact

The data indicates that small businesses were not directly involved in this specific award, as the prime contractor is a large corporation.

Oversight & Accountability

The award is a delivery order, implying it's part of a pre-existing contract that has likely undergone prior oversight. Further review of the parent contract is recommended.

Related Government Programs

Pharmaceutical Preparation Manufacturing
Department of Health and Human Services Contracting
Indian Health Service Programs

Risk Flags

Potential for price increases over contract duration.
Dependence on a single large supplier.
Limited visibility into specific product sourcing.
Need for ongoing performance monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $2.4 million to MCKESSON CORPORATION. FSS PHARMACEUTICAL, MEDICAL, AND SURGICAL SUPPLIES FOR PINON HEALTH CENTER

Who is the contractor on this award?

The obligated recipient is MCKESSON CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Indian Health Service).

What is the total obligated amount?

The obligated amount is $2.4 million.

What is the period of performance?

Start: 2024-08-30. End: 2026-08-09.

What is the historical pricing trend for McKesson Corporation's pharmaceutical and medical supplies under similar contracts?

Analyzing McKesson's past performance on comparable government contracts can reveal pricing trends and potential cost savings. This includes examining price adjustments, volume discounts, and the impact of contract duration on unit costs. Understanding this history provides a baseline for assessing the current award's value and identifying any deviations.

What are the specific risks associated with relying on a single large supplier like McKesson for critical medical supplies?

Reliance on a single large supplier can introduce risks such as supply chain disruptions due to the supplier's internal issues, potential price increases if competition diminishes, and limited flexibility in sourcing alternative products. Diversifying suppliers or establishing robust contingency plans can mitigate these risks.

How effectively does this contract ensure the availability and quality of essential pharmaceuticals and medical supplies for the Pinon Health Center?

The firm-fixed-price structure and full-and-open competition suggest an intent to ensure both availability and reasonable cost. However, ongoing monitoring of delivery performance, product quality, and adherence to specifications is crucial to confirm the contract's effectiveness in meeting the health center's needs.

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: $2,385,444

Exercised Options: $2,385,444

Current Obligation: $2,385,444

Actual Outlays: $2,385,444

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