VA's Pharmacy Prime Vendor Contract with McKesson Corporation Totals $34.3M for Drugs and Sundries

Contract Overview

Contract Amount: $34,348,725 ($34.3M)

Contractor: Mckesson Corporation

Awarding Agency: Department of Veterans Affairs

Start Date: 2009-09-01

End Date: 2009-09-30

Contract Duration: 29 days

Daily Burn Rate: $1.2M/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: EXPRESS REPORT PHARMACY PRIME VENDOR

Place of Performance

Location: MURFREESBORO, RUTHERFORD County, TENNESSEE, 37129

State: Tennessee Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $34.3 million to MCKESSON CORPORATION for work described as: EXPRESS REPORT PHARMACY PRIME VENDOR Key points: 1. The contract, valued at $34.3 million, covers drugs and druggists' sundries. 2. Awarded under full and open competition, indicating a competitive bidding process. 3. The contract duration was 29 days, suggesting a short-term or interim award. 4. The vendor is McKesson Corporation, a major player in pharmaceutical distribution.

Value Assessment

Rating: good

The contract value of $34.3M for a 29-day period suggests a significant volume of pharmaceutical goods. Benchmarking against similar VA pharmacy contracts would be necessary for a precise pricing assessment, but the full and open competition indicates a potentially competitive price discovery.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded through full and open competition, which typically allows for the widest range of potential bidders and fosters price discovery. This method is generally expected to yield competitive pricing for the government.

Taxpayer Impact: The competitive nature of the award suggests that taxpayers are likely receiving fair market value for the pharmaceuticals procured under this contract.

Public Impact

Ensures access to essential medications for veterans. Supports the Department of Veterans Affairs' healthcare mission. Impacts pharmaceutical supply chain reliability for VA facilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Short contract duration (29 days) may indicate an interim solution or a specific, limited need.
Lack of detailed product breakdown makes per-unit cost analysis difficult.

Positive Signals

Awarded under full and open competition, promoting market fairness.
Significant contract value suggests a critical need for pharmaceutical supplies.

Sector Analysis

This contract falls within the healthcare sector, specifically pharmaceutical wholesale. Spending benchmarks in this area are highly variable based on the specific drugs and volumes procured. The VA's reliance on prime vendors is standard for managing large-scale pharmaceutical needs.

Small Business Impact

The data does not indicate whether small businesses were involved as subcontractors or suppliers in this contract. McKesson Corporation is a large business, and contracts of this nature often involve complex distribution networks.

Oversight & Accountability

The Department of Veterans Affairs is responsible for overseeing this contract. Standard procurement regulations and oversight mechanisms would apply to ensure compliance and performance.

Related Government Programs

Drugs and Druggists' Sundries Merchant Wholesalers
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Short contract duration
Lack of detailed product/service breakdown
Potential for price fluctuations in pharmaceutical markets

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $34.3 million to MCKESSON CORPORATION. EXPRESS REPORT PHARMACY PRIME VENDOR

Who is the contractor on this award?

The obligated recipient is MCKESSON CORPORATION.

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 $34.3 million.

What is the period of performance?

Start: 2009-09-01. End: 2009-09-30.

What was the specific reason for the short 29-day contract duration?

The short duration of 29 days suggests this contract may have been an interim measure to bridge a gap between other contracts, fulfill an immediate and urgent need, or was part of a larger, phased procurement strategy. Without further context, it's difficult to ascertain the precise strategic intent behind such a brief performance period.

How does the pricing compare to other federal pharmaceutical contracts?

A direct pricing comparison is challenging without detailed line-item data and knowledge of the specific drugs and quantities procured. However, the contract's award under full and open competition implies a competitive price discovery process. Benchmarking against similar VA prime vendor contracts, adjusted for volume and product mix, would be the most accurate method for a thorough assessment.

What is the potential impact of McKesson's role on pharmaceutical availability for veterans?

As a major pharmaceutical distributor, McKesson's role as the Pharmacy Prime Vendor is critical for ensuring the consistent availability of a wide range of medications for veterans. Their established supply chain and distribution network are designed to meet the high-volume demands of the VA, thereby supporting the continuity of care for beneficiaries.

Industry Classification

NAICS: Wholesale Trade › Drugs and Druggists' Sundries Merchant Wholesalers › Drugs and Druggists' Sundries Merchant Wholesalers

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1 POST ST, SAN FRANCISCO, CA, 90

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $34,348,725

Exercised Options: $34,348,725

Current Obligation: $34,348,725

Parent Contract

Parent Award PIID: V797P1020

IDV Type: IDC

Timeline