HHS Awards $4.1M for Pharmaceutical Supplies to McKesson Corporation for Gallup Indian Medical Center

Contract Overview

Contract Amount: $4,090,328 ($4.1M)

Contractor: Mckesson Corporation

Awarding Agency: Department of Health and Human Services

Start Date: 2025-07-16

End Date: 2026-01-31

Contract Duration: 199 days

Daily Burn Rate: $20.6K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: PHARMACEUTICAL SUPPLIES FOR GALLUP INDIAN MEDICAL CENTER

Place of Performance

Location: IRVING, DALLAS County, TEXAS, 75039

State: Texas Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $4.1 million to MCKESSON CORPORATION for work described as: PHARMACEUTICAL SUPPLIES FOR GALLUP INDIAN MEDICAL CENTER Key points: 1. Spending of $4.1M on pharmaceutical supplies. 2. McKesson Corporation is the sole awardee. 3. Potential risk associated with single-source award. 4. Sector: Healthcare (Pharmaceutical Preparation Manufacturing).

Value Assessment

Rating: fair

The contract value of $4.1M for pharmaceutical supplies appears reasonable for the period of performance. Benchmarking against similar contracts for federal medical centers would provide a clearer assessment of 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. However, this specific award is a delivery order, and the initial contract vehicle's competition level is key.

Taxpayer Impact: Taxpayer funds are used for essential medical supplies, ensuring healthcare services for the Gallup Indian Medical Center.

Public Impact

Ensures continued availability of critical pharmaceutical supplies for Native American healthcare. Supports patient care at the Gallup Indian Medical Center. Potential for price fluctuations if competition is not sustained in future contract vehicles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Reliance on a single vendor for critical supplies.
Potential for price increases in future contract periods.

Positive Signals

Awarded under full and open competition.
Ensures continuity of care.

Sector Analysis

This spending falls within the healthcare sector, specifically pharmaceutical preparation manufacturing. Federal spending on pharmaceuticals is substantial, driven by the needs of agencies like the Indian Health Service.

Small Business Impact

The data does not indicate if small businesses were involved in this specific award. Further analysis would be needed to determine small business participation.

Oversight & Accountability

The Indian Health Service is responsible for overseeing this contract. Standard procurement regulations and oversight mechanisms should ensure accountability.

Related Government Programs

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

Risk Flags

Sole awardee for this delivery order.
Potential for price escalation.
Dependence on a single supplier's supply chain.
Limited visibility into the initial contract vehicle's competition details.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $4.1 million to MCKESSON CORPORATION. PHARMACEUTICAL SUPPLIES FOR GALLUP INDIAN MEDICAL 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 $4.1 million.

What is the period of performance?

Start: 2025-07-16. End: 2026-01-31.

What is the benchmarked per-unit cost for these pharmaceutical supplies compared to other federal or commercial contracts?

Benchmarking the per-unit cost of these pharmaceutical supplies is crucial for assessing value. Without specific product details and volume comparisons, it's difficult to provide an exact benchmark. However, comparing pricing against GSA schedules or other large federal contracts for similar medications can reveal potential overpricing or cost savings.

What is the risk of supply chain disruption given the reliance on a single awardee?

Reliance on a single awardee, even if competitively selected initially, presents a risk of supply chain disruption. Factors like McKesson Corporation's own manufacturing or distribution issues, natural disasters, or geopolitical events could impact delivery. Diversifying suppliers or maintaining strategic stockpiles could mitigate this risk.

How effectively does this contract ensure the availability of a wide range of necessary pharmaceuticals?

The effectiveness of this contract in ensuring a wide range of pharmaceuticals depends on the specific terms and the breadth of McKesson's catalog. While McKesson is a major distributor, a single contract might not cover all niche or specialized medications. The Indian Health Service should monitor inventory and patient needs to ensure comprehensive coverage.

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: $20,090,328

Exercised Options: $4,090,328

Current Obligation: $4,090,328

Actual Outlays: $4,090,328

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