BNUMBER:  B-271845
DATE:  August 23, 1996
TITLE:  SmithKline Beechman Pharmaceuticals

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Matter of:SmithKline Beechman Pharmaceuticals

File:     B-271845

Date:August 23, 1996

Robert H. Koehler, Esq., and Michael J. Schaengold, Esq., Patton 
Boggs, for the protester.
Barbara Robbins, Esq., Department of Health and Human Services, for 
the agency.
Glenn G. Wolcott, Esq., and Paul Lieberman, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

1.  Where statute concerning vaccine procurements states that the 
agency "shall, as appropriate" award multiple contracts, and further 
provides that the agency "may decline to enter into such contracts," 
the plain language of the statute affords the agency discretionary 
authority to refrain from making multiple contract awards in 
appropriate circumstances.

DECISION

SmithKline Beechman Pharmaceuticals protests the provisions of request 
for proposals (RFP) No. 96-51(N), issued by the Department of Health 
and Human Services (HHS), Centers for Disease Control and Prevention 
(CDC), for quantities of hepatitis B high risk/adolescent vaccine.  
SmithKline objects that the solicitation provision advising that only 
a single award will be made is improper, and argues that the agency is 
statutorily required to award a contract to every qualified offeror 
regardless of price.[1] 

We deny the protest.

On April 10, 1996, the CDC issued RFP No. 96-51(N) calling for the 
award of an indefinite quantity contract to provide quantities of 
hepatitis B high risk/adolescent vaccine.[2]  The solicitation 
provided for a minimum of 1.1 million doses of vaccine with an 
estimated maximum of 11 million doses.  

Under the heading "Evaluation and Award," the solicitation stated:

     "b.  The Government intends to make only one award under this 
     solicitation.  The low offeror shall be determined based on the 
     lowest offered price per dose.

     "c.  Award shall be made to the low responsible offeror who 
     offers a reasonable discounted price [and meets other qualifying 
     requirements.]"

SmithKline protests that this solicitation provision is contrary to 
the statutory requirements of OBRA which, SmithKline asserts, mandate 
award of a contract to every qualified offeror.  SmithKline bases its 
protest on the following OBRA provision, codified at 42 U.S.C.  sec.  
1396s, which states:

     "(d) Negotiation of Contracts with Manufacturers

        (1)  In General

        For the purpose of meeting obligations under this section, the 
        Secretary shall negotiate and enter into contracts with 
        manufacturers of pediatric vaccines consistent with the 
        requirements of this subsection . . . .

                    .    .    .    .    .

        (7)  Multiple Suppliers

        In the case of the pediatric vaccine involved, the Secretary 
        shall, as appropriate, enter into a contract referred to in 
        paragraph (1) with each manufacturer of the vaccine that meets 
        the terms and conditions of the Secretary for an award of such 
        a contract (including terms and conditions regarding safety 
        and quality).  With respect to multiple contracts entered into 
        pursuant to this paragraph, the Secretary may have in effect 
        different prices under each of such contracts . . . ."

SmithKline maintains that the statutory provision codified at (d)(7) 
"mandates that the [agency] conduct procurements . . . in a manner 
that allocates the doses so that all qualified manufacturers will be 
awarded contracts," and asserts that "CDC does not have the authority 
to make a single award here."  We disagree.

SmithKline's assertion that the language of (d)(7) should be read as 
"the Secretary shall . . . enter into a contract . . . with each 
[qualified] manufacturer" effectively reads the words "as appropriate" 
out of the statute, thus altering the plain meaning of the statute.  
SmithKline also ignores the statutory language codified at 42 U.S.C.  sec.  
1396s(d)(2), which states:

     "Authority to Decline Contracts

     The Secretary may decline to enter into such contracts 
     [identified in section (d)(1)] and may modify or extend such 
     contracts."

It is well settled that, where the language of a statute is clear on 
its face, its plain meaning will be given effect; that is, if the 
intent of Congress is clear, "that is the end of the matter."  
Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 
U.S. 837, 842 (1984).  In this regard, the clear intent of Congress 
must be determined by giving meaning to all statutory language.  See, 
e.g., Babbitt v. Sweet Home Chapter of Communities for a Great Oregon, 
115 S.Ct. 2407, 2413 (1995); Consumer Fed'n of Am. v. U.S. Department 
of Health and Human Servs., 83 F.3d 1497 (D.C. Cir. 1996);  Ziegler 
Coal Co. v. Kleppe, 536 F.2d 398, 406 (D.C. Cir. 1976); Tuten v. 
United States, 440 A.2d 1008, 1010 (D.C. 1982), aff'd, 460 U.S. 660 
(1983). 

Here, we find without merit SmithKline's assertion that the language 
of OBRA "mandates" award to all qualified offerors.  On the contrary, 
the plain meaning of the statutory language codified at (d)(7) 
provides that the agency shall award contracts to qualified 
contractors "as appropriate."  That express discretionary authority is 
similarly reflected in the provision at (d)(2), which authorizes the 
agency to "decline to enter into such contracts."  In short, the plain 
language of OBRA grants the agency the discretion to refrain from 
awarding contracts in appropriate circumstances.  Pursuant to Chevron, 
U.S.A, supra, that is the end of the matter.[3]  

The protest is denied. 

Comptroller General
of the United States

1. Initially, SmithKline also challenged a provision of the 
solicitation regarding the type of packaging that was required.  In 
response to this issue, the agency amended the solicitation in a 
manner which, as SmithKline agrees, renders that issue moot.

2. The acquisition is a part of the Vaccines for Children Program 
under the Omnibus Budget Reconciliation Act of 1993 (OBRA), 42 U.S.C.  sec.  
1396s (1994), which is a federally funded program for the acquisition 
and distribution of pediatric vaccine for the immunization of eligible 
children.  

3. In arguing that the agency must award SmithKline a contract, 
regardless of price, SmithKline refers to OBRA's legislative history, 
which contains the following provisions:

            "The Conference Agreement further provides that the 
            Secretary shall, as appropriate, enter into a contract 
            with each manufacturer of the vaccine that meets the terms 
            and conditions of the Secretary.  The Secretary also may 
            have multiple prices. 

                           .     .     .     .     .

            "The Conference Agreement also provides authority for the 
            Secretary to decline to enter into contracts.  The 
            Conferees have provided this authority for extreme 
            circumstances only and, again, would emphasize the 
            importance of continuity of vaccine suppliers for 
            federally vaccine-eligible children and States."  139 
            Cong. Rec. H6172-6173 (daily ed. Aug. 5, 1993).

SmithKline argues that the reference to "extreme circumstances" 
should, effectively, be read into the statute, and that costs to the 
government may not be considered in determining what constitutes an 
"extreme circumstance."

SmithKline's arguments regarding the effect of the legislative history 
are unavailing.  Legislative history, while often indicative of 
congressional intent, is not law.  To effectively impose the "extreme 
circumstances" test as a mandatory limitation on the agency's exercise 
of its discretionary authority, the Congress would have had to include 
that provision in the statute itself.  See LTV Aerospace Corp., 55 
Comp. Gen. 307 (1975), 75-2 CPD  para.  203.  Moreover, even if the "extreme 
circumstances" limitation were read into the statute, nothing in the 
legislative history concerning that limitation precludes the agency 
from considering costs to the government in determining what 
constitutes an "extreme circumstance."