DoD's $34M contract for pharmacy operations support awarded to UNISSANT INC. shows fair value, but limited competition context warrants scrutiny

Contract Overview

Contract Amount: $34,006,006 ($34.0M)

Contractor: Unissant Inc.

Awarding Agency: Department of Defense

Start Date: 2019-05-18

End Date: 2024-10-18

Contract Duration: 1,980 days

Daily Burn Rate: $17.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: LABOR PHARMACY OPERATION QUALITY AND COST-APPROPRIATE ANALYTICAL, TECHNICAL, AND PROGRAM MANAGEMENT SERVICES

Place of Performance

Location: SAN ANTONIO, BEXAR County, TEXAS, 78230

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $34.0 million to UNISSANT INC. for work described as: LABOR PHARMACY OPERATION QUALITY AND COST-APPROPRIATE ANALYTICAL, TECHNICAL, AND PROGRAM MANAGEMENT SERVICES Key points: 1. Contract value of $34 million over five years suggests a significant investment in pharmacy operations support. 2. The award was made under full and open competition, indicating a broad initial outreach for potential bidders. 3. The contract's duration of 1980 days (approx. 5.4 years) is substantial, requiring sustained performance and oversight. 4. The fixed-price contract type aims to control costs, but requires careful monitoring of scope creep. 5. The primary contractor, UNISSANT INC., has secured this significant award, highlighting their role in defense health services. 6. The contract is geographically focused in Texas, suggesting a specific regional need for these services.

Value Assessment

Rating: good

The contract's total value of $34 million over approximately five years averages around $6.8 million annually. Benchmarking against similar administrative management and general management consulting services contracts is challenging without more specific service details. However, the firm-fixed-price structure suggests an effort to contain costs. The number of bids received (3) is on the lower side for a full and open competition, which could imply that the pricing might not have benefited from the most aggressive market competition, but it still indicates some level of market interest.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit an offer. However, only three bids were received. While 'full and open' is the most competitive category, a low number of bidders can sometimes indicate barriers to entry, specialized requirements, or a lack of market awareness. The limited number of bidders may have reduced the downward pressure on pricing that could be expected from a larger pool of competitors.

Taxpayer Impact: A low number of bids in a full and open competition suggests that while the process was open, the market may not have been as robustly engaged as possible, potentially leading to less aggressive pricing for taxpayers.

Public Impact

The primary beneficiaries are the Department of Defense and its personnel, who will receive improved pharmacy operations and quality of care. Services delivered include analytical, technical, and program management support to ensure cost-appropriate pharmacy operations. The geographic impact is concentrated in Texas, where the Defense Health Agency operates and requires these specialized services. Workforce implications may include the direct employment of personnel by UNISSANT INC. and potential indirect impacts on military and civilian healthcare staff within the DHA.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited number of bidders (3) in a full and open competition could indicate potential market concentration or barriers to entry.
The long contract duration (nearly 5.5 years) requires sustained vigilance to prevent performance degradation or scope creep.
Lack of specific details on performance metrics makes it difficult to fully assess the 'quality' aspect of the services.
The 'cost-appropriate' aspect needs continuous monitoring to ensure value for money is maintained throughout the contract term.

Positive Signals

Awarded under 'full and open competition', which is the most competitive contract type.
The firm-fixed-price (FFP) contract type provides cost certainty for the government.
The Defense Health Agency is a critical component of military healthcare, suggesting the services are of high importance.
The contract aims to improve 'quality and cost-appropriate' pharmacy operations, indicating a focus on efficiency and effectiveness.

Sector Analysis

This contract falls within the Management and Consulting Services sector, specifically focusing on administrative and general management consulting. This sector is broad, encompassing a wide range of advisory and support services to government agencies. The Defense Health Agency's need for specialized pharmacy operations support highlights a niche within this sector, critical for the efficient functioning of military healthcare systems. Comparable spending benchmarks are difficult to ascertain without more granular data on the specific types of analytical, technical, and program management services provided.

Small Business Impact

The data indicates that small business participation was not a specific set-aside (ss: false) nor was there a stated subcontracting goal (sb: false). This suggests that small businesses were not explicitly targeted for this contract's prime award or subcontracting opportunities through specific set-aside provisions. While UNISSANT INC. may choose to subcontract with small businesses, there is no contractual requirement evident here, potentially limiting direct opportunities for the small business ecosystem in this specific contract.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the Defense Contract Management Agency (DCMA) or equivalent within the Defense Health Agency. The firm-fixed-price nature of the contract implies that the contractor is responsible for delivering the specified services within the agreed-upon price. Transparency is generally facilitated through contract databases like FPDS. Accountability measures would be tied to performance clauses and the potential for contract modifications or termination if services are not met. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Defense Health Agency Operations Support Contracts
Pharmacy Benefit Management Services
Healthcare Consulting Services
Federal Management and Consulting Contracts
Military Health System Support

Risk Flags

Low number of bids received for a full and open competition.
Contract duration exceeds 5 years, requiring sustained oversight.
Lack of explicit small business subcontracting goals.
Specific performance metrics and quality standards not detailed in summary data.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $34.0 million to UNISSANT INC.. LABOR PHARMACY OPERATION QUALITY AND COST-APPROPRIATE ANALYTICAL, TECHNICAL, AND PROGRAM MANAGEMENT SERVICES

Who is the contractor on this award?

The obligated recipient is UNISSANT INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Health Agency).

What is the total obligated amount?

The obligated amount is $34.0 million.

What is the period of performance?

Start: 2019-05-18. End: 2024-10-18.

What is the track record of UNISSANT INC. in performing similar government contracts, particularly within the healthcare or defense sectors?

Assessing UNISSANT INC.'s track record requires a deeper dive into their contract history beyond this single award. While this $34 million contract is substantial, it's crucial to examine past performance on similar contracts, including their size, scope, and duration. Key indicators include on-time delivery, adherence to budget, quality of services rendered, and any past performance evaluations or disputes. Information on previous contracts, especially those with the Department of Defense or other federal agencies, would provide context on their capabilities and reliability in managing complex programs like pharmacy operations support. Without this historical data, it's difficult to definitively assess their experience and suitability for this role.

How does the awarded price compare to market rates for similar pharmacy operations analytical, technical, and program management services?

Determining the precise value-for-money requires a detailed comparison with market rates for highly specialized pharmacy operations support. The contract's average annual value is approximately $6.8 million. Benchmarking this against industry standards for similar services, considering factors like the complexity of military pharmacy systems, the scope of analytical and technical support, and program management requirements, is essential. Given that only three bids were received under full and open competition, the pricing might not reflect the most competitive market conditions. A thorough analysis would involve comparing the proposed labor rates, overhead, and profit margins against industry benchmarks and potentially other government contracts for comparable services, adjusted for geographic location and specific service requirements.

What are the specific performance metrics and quality standards outlined in the contract, and how are they being monitored?

The contract description mentions 'quality and cost-appropriate analytical, technical, and program management services,' but the specific performance metrics and quality standards are not detailed in the provided data. Effective oversight relies on clearly defined Key Performance Indicators (KPIs) and Service Level Agreements (SLAs). For a contract of this magnitude and duration, these would typically include metrics related to operational efficiency, cost savings achieved, accuracy of analysis, timeliness of technical support, and overall program management effectiveness. Monitoring these metrics is crucial for ensuring the contractor meets expectations and delivers value. Without access to the contract's statement of work and performance work statement, a full assessment of the quality assurance and monitoring mechanisms is not possible.

What is the historical spending trend for pharmacy operations support services within the Defense Health Agency or the DoD?

Analyzing historical spending trends for pharmacy operations support within the Defense Health Agency (DHA) and the broader Department of Defense (DoD) would provide valuable context for this $34 million contract. Understanding whether this award represents an increase, decrease, or stable level of investment in such services is key. Examining past contracts for similar support, including their values, durations, and the contractors involved, can reveal patterns in procurement strategies and market dynamics. This historical data can help identify if spending has been consistent, if there have been significant shifts in demand, or if this contract is part of a larger strategic initiative to enhance pharmacy operations. Without specific historical spending figures, it's difficult to place this contract within a broader financial context.

What are the potential risks associated with a contract of this duration and value, particularly concerning contractor performance and cost overruns?

Contracts of this duration (nearly 5.5 years) and value ($34 million) carry inherent risks. For contractor performance, the extended timeline increases the possibility of personnel turnover, shifts in organizational priorities, or a decline in service quality over time. Maintaining consistent high performance requires robust contract management and ongoing performance evaluations. Cost overrun risks, while mitigated by the firm-fixed-price structure, can still arise from scope creep, unforeseen technical challenges, or inadequate initial cost estimation. Effective risk mitigation involves clear contract terms, proactive monitoring of performance and costs, and strong communication channels between the government and the contractor to address issues early.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HT001118R0028

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 12901 WORLDGATE DR, HERNDON, VA, 20170

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Small Business, Small Disadvantaged Business, Special Designations, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $34,265,937

Exercised Options: $34,011,006

Current Obligation: $34,006,006

Actual Outlays: $216,960

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS10F0300U

IDV Type: FSS

Timeline