6515--COVID-19 Tablo Hemodialysis Systems (VA-20-00080837)

Page 2 of 2 Source Selection Information IAW FAR 2.101 and 3.104. Page 2 of 2 Justification for Other than Full and Open Competition For Tablo Hemodialysis Systems 1. Contracting Activity: Department of Veterans Affairs (VA) Veterans Health Administration Strategic Acquisition Center 10300 Spotsylvania Avenue Suite 400 Fredericksburg, VA 22408 2. Description of Action: This proposed sole source action is for an urgent requirement for 22 Tablo® Helodialysis Systems (with the treatment package and XT software upgrade). The Veterans Health Administration (VHA), Procurement and Logistics (10NA2), Equipment Life Cycle Management (ELCM) Program has identified an urgent requirement for delivery as soon as possible in support of treatment of Veterans with COVID-19 infection. The contractor shall deliver the supplies ordered under this contract to several different locations around the United States by 9/1/2020. Due to the ever-changing environment, exact delivery locations will be provided as priority locations are determined after award. The Contracting Officer has determined a firm-fixed price (FFP) contract is appropriate for this acquisition. The total estimated cost/price of the contract, including all accessory items, expendables, shipping and handling, and training is $1,350,000. This estimate is based on the Independent Government Estimate (IGE) based on market research completed by the Procurement and Logistics Office (P&LO). This is a short-term solution to ensure maximum care to Veterans with COVID-19 infection. 3. Description of the Supplies or Services: The VHA P&LO, ELCM Program has a requirement for 22 Hemodialysis Systems, that includes the treatment packages and XT software upgrades, delivery, installation, and training as determined necessary in support of VHAs response to COVID-19 in the United States. The Contractor shall deliver the units to support the VHA s response to the COVID-19 pandemic. Dialysis is an artificial process that uses a special fluid containing a mixture of pure water and chemicals to carefully eliminate wastes, salt, and extra water from the blood without removing substances the body needs. This process helps control blood pressure and keeps the body s electrolytes in balance by keeping safe levels of potassium, sodium, and bicarbonate in the blood. A Hemodialysis System is used in dialysis that filters a patient's blood to remove excess water and waste products when the kidneys are not functionally properly. The estimated value of this sole source award is $1,350,000. 4. Statutory Authority: FAR 6.302-2 Unusual and Compelling Urgency The statutory authority permitting other than full and open competition is 41 U.S.C. §3304(b)(2), as implemented by Federal Acquisition Regulation (FAR) 6.302-2, entitled Unusual and Compelling Urgency. 5. Rationale Supporting Use of Authority Cited Above: The U.S. Department of Veterans Affairs (VA), Veterans Health Administration (VHA) manages the United States largest integrated healthcare system, providing care at 1,234 healthcare facilities, including 172 medical centers and 1,062 outpatient sites of care of varying complexity (VHA outpatient clinics), serving approximately 9 million enrolled Veterans each year. There are 104 VA medical centers (VAMCs) that provide dialysis. Annually, VA provides dialysis to approximately 4,000 Veterans. Coronaviruses make up a large family of viruses that can infect birds and mammals, including humans. Historically, these viruses have been responsible for several outbreaks around the world, including the severe acute respiratory syndrome (SARS) pandemic of 2002-2003 and the Middle East respiratory syndrome (MERS) outbreak in South Korea in 2015. The current coronavirus (COVID-19) is highly contagious and is most often, spread from person-to-person contact within close range (about 6 feet) of an infected individual. Person-to-person spread is thought to occur primarily via respiratory droplets produced when an infected person coughs or sneezes, similar to how influenza and other respiratory pathogens spread. These droplets can land in the mouths or noses of people who are nearby or possibly be inhaled into the lungs. In humans, coronaviruses typically cause a respiratory infection with mild to severe flu-like symptoms, with an incubation period of 14 and up to 24 days after exposure. This incubation period increases the potential for impact to the US population as infected persons who do not display symptoms are active and can pass the virus on to multiple individuals. A subset of individuals, including those with cardiopulmonary disease or a weakened immune system, are at high risk of the viral infection progressing to a more severe lower-respiratory infection such as pneumonia or bronchitis. To date, COVID-19 has an estimated mortality rate of 2% of infected individuals however, the ease of transmission combined with the lengthy incubation period before an infected individual begins to display symptoms could increase this estimated mortality rate. Hemodialysis units perform extracorporeal dialysis to replace the main activity of the kidneys in patients with impaired renal function. Impaired kidney function causes the body to retain metabolic wastes and water. Hemodialysis therapy removes these, as well as, ions and organic salts from the bloodstream. This process restores a reasonable state of health by partially performing renal functions, thereby minimizing further damage to other organs and physiologic systems. Continuous Renal Replacement Therapy (CRRT) machines are used to treat patients suffering from acute kidney injury (AKI), a critical condition characterized by sudden temporary loss of normal kidney function. The performance of dialysis is highly complex. Typically, a water purification device is needed to purify the water used to make dialysate and a separate device (commonly referred to as a dialysis machine) is used to deliver the dialysate to the patient. The Tablo® Hemodialysis System is unique in that water purification and dialysate delivery are combined into one integrated device. This is particularly important as the Tablo® system will primarily be used in the ICU for COVID-19 patients where space for multiple devices is extremely limited. Furthermore, the Tablo® Hemodialysis System is mobile and can be quickly moved to different locations within a medical center (i.e. ICU, ER, CLC, dialysis unit, etc.). It uses standard 15A and 20A outlets to carry out treatments in an outpatient and ambulatory setting. Additionally, typical water purification devices require extensive plumbing/connections to purify water for dialysis. The Tablo® Hemodialysis system is unique in that only tap water is required. The Tablo® Hemodialysis system has recently been approved by the Federal Drug Administration for home use. Furthermore, the Tablo® Hemodialysis System has a simplified user interface and minimal staff training requirements [approximately four (4) hours]. This is significantly less that other devices on the market that require extensive training and are highly prone to user errors. The Tablo® Hemodialysis system uses a plug and play closed cartridge system without an integrated dialyzer that reduces unnecessary manual steps in cartridge replacement and allows for flexibility in prescribing. A simplified user interface and the closed cartridge system minimizes human error and, ultimately, reduces the risk to patients safety. Further, the system allows the clinician the flexibility to shift between modalities such as intermittent hemodialysis (IHD) to extend renal replacement therapy (RRT) without necessitating a cartridge change or requiring specialized nursing staff. It allows for automated transitions between ultra-filtration (UF) only and intermitted dialysis without a cartridge change or staff intervention. Automated scheduled saline flushes reduce or eliminate the need for heparin or citrate. SDV Office Systems, LLC is the SDVOSB authorized dealer of Outset Medical, the manufacturer of the Tablo® Hemodialysis System. SDV Office Systems, LLC has worked extensively with other VHA hospitals for the Tablo® system and is familiar with the VHA healthcare system. They have previously provided Tablo® Hemodialysis Systems in support of COVID-19 requirements. The 22 Tablo® Hemodialysis Systems will be delivered to VA Medical Centers that currently utilize Tablo® systems, minimizing delivery, installation, transition, and training requirements. They currently have other large orders with the VA over the simplified acquisition threshold. SDV Office Systems, LLC has no negative past performance in the Contractor Performance Assessment Reporting System (CPARS) and has zero (0) records filed for defective pricing, default, material failure to comply, and termination for cause in the Federal Awardee Performance and Integrity Information System (FAPIIS). They are also manufacturer trained on the Tablo® Hemodialysis system. The vendor is capable of fulfilling this requirement as they are prioritizing this emergency COVID-19 related order. They will be in constant, direct communication with the manufacturer on the production and delivery schedule and will be required by the Statement of Work to work closely with the COR and provide weekly status reports. 6. Efforts to Obtain Competition: Market research was conducted and detailed on the Market Research document. An electronic Request for Information/Sources Sought Notice (SSN) identified three potential vendors to satisfy the Hemodialysis Systems requirements. These three (3) vendors included: SDV Office Systems, LLC (SDV Medical); Veterans Healthcare Supply; and SAGICO VA USA. At this time, SDV Office Systems, LLC is uniquely positioned to meet the Government s need to sustain patient care and satisfy agency requirements without risk to Veterans undergoing CRRT treatment. The proposed action will be synopsized on Contract Opportunities in accordance with FAR 5.201. 7. Fair and Reasonable Cost Determination: In accordance with FAR 13.106-3 Award and Documentation, it is our expectation that the proposed price will be determined fair and reasonable based on comparison of the proposed prices to historical prices paid, whether by the Government or other than the Government for the same or similar items and comparison to the IGCE and by reviewing past VHA orders for the same system purchased. Additionally, the established pricing will favorably compare with current market conditions. 8. Market Research: Market Research to date has indicated a limited number interested parties however, at this time, it is in the government s best interest to pursue a sole source award with SDV Office Systems, LLC to avoid undue risk to patient care. Robust market research will continue and it is anticipated that the new contract for Hemodialsys Systems will be competitively awarded. 9. Other Facts: This requirement is for a designated National Emergency for immediate delivery of 22 Tablo® Hemodialysis Systems that includes the treatment packages and XT software upgrades, delivery, installation, and training to be delivered to various locations around the United States in support of the COVID-19 pandemic. Hemodialysis systems are critical to treating patients with end-stage kidney disease and comorbid COVID-19 infection. It is critical this requirement is awarded immediately to provide care to our Veterans. Delay of an award would result in serious injury or death to the Veteran public. The agency and the Veterans we support will be subject to extreme harm if this requirement is not approved as award of this contract is needed to sustain VA patient care and satisfy agency requirements without risk to Veterans undergoing CRRT treatment. 10. Sources: An electronic Request for Information/Sources Sought Notice(eRFI/SSN) identified three (3) potential vendors to satisfy the Hemodialysis Systems requirements. The following three (3) vendors responded in writing and include: SDV Office Systems, LLC (SDV Medical); Veterans Healthcare Supply; and, SAGICO VA USA 11. Actions to Increase Competition: Prior to initiating any subsequent acquisitions for Hemodialysis Systems, further market research will be conducted. Robust market research continues and it is anticipated that the next contract will be competitively awarded. A statement of the actions, if any, the agency may take to remove or overcome any barriers to competition will be documented before any subsequent acquisition for the supplies or services required.