TITLE: B-298444, Bausch & Lomb, Inc., September 21, 2006
BNUMBER: B-298444
DATE: September 21, 2006
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B-298444, Bausch & Lomb, Inc., September 21, 2006

   Decision

   Matter of: Bausch & Lomb, Inc.

   File: B-298444

   Date: September 21, 2006

   John F. LaFave, Esq., for the protester.

   Dennis Foley, Esq., and Philip Kauffman, Esq., Department of Veterans
   Affairs, for the agency.

   Katherine I. Riback, Esq., and James A. Spangenberg, Esq., Office of the
   General Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   Agency's sole-source order of ophthalmology equipment based on unusual and
   compelling urgency was improper where the awardee was determined to be the
   only responsible source, yet the capabilities of the equipment of other
   interested firms were not considered.

   DECISION

   Bausch & Lomb, Inc. (B&L) protests the Department of Veterans Affairs'
   (VA) issuance of sole-source purchase orders to Alcon Laboratories, Inc.
   for ophthalmology equipment used in cataract procedures for the VA Medical
   Centers (VAMC) located at Albany and Syracuse, New York.

   We sustain the protest.

   The Chief of Ophthalmology in the VAMC Albany facility indicated, in a
   memorandum dated May 31, that two patients developed eye infections due to
   the use of certain medical equipment used in cataract procedures because
   the equipment had been improperly cleaned. The doctor went on to state in
   the memorandum that the medical equipment was outdated in any case and
   required replacement and that her doctors were familiar and comfortable
   with the Infiniti machine manufactured by Alcon as a result of their
   private practice experiences. Agency Report, Tab B, VAMC Albany Memorandum
   (May 31, 2006).

   On that same day, the VA issued a purchase order for ophthalmology medical
   equipment for cataract procedures to Alcon for the VAMC Albany facility.
   The order was made without advertisement or competition on the basis of
   unusual and compelling urgent circumstances affecting patient care at the
   facility.

   On June 14, the VA publicized in FedBizOpps an intent to award a
   sole-source contract to Alcon for ophthalmology medical equipment for
   cataract procedures for the VAMC Syracuse facility, and invited interested
   parties to respond by 4:30 p.m. that same day. Agency Report, Tab C,
   FedBizOpps Notice, June 14, 2006. On that same date, VA issued a
   sole-source purchase order to Alcon for the equipment.

   The equipment ordered under these purchase orders has been delivered.
   After the awards were made, the contracting officer prepared an undated
   justification and approval (J&A) for other than full and open competition
   on the basis of urgent circumstances for the sole-source purchases of
   medical equipment for the VAMC Albany and the VAMC Syracuse facilities.[1]
   The J&A stated that the ophthalmology equipment for the two VAMC
   facilities was urgently needed and that its doctors have found that only
   Alcon could meet the needs of the government because its ophthalmology
   equipment was "state of the art technology," and that other similar units
   on the market lacked "advanced design features," such as a torsional phaco
   handpiece or the aqualase technology. The J&A also stated that the "other
   vendors have had no significant change in their handpiece design in 14
   years." Regarding the Syracuse VAMC facility, the J&A stated that the
   medical equipment in question was 12 years old and had been proven
   unreliable in the operating room. The J&A finally stated, without further
   elaboration, that B&L and another firm had expressed an interest in these
   acquisitions. Agency Report, Tab B, J&A.[2]

   The protester contends that the sole-source orders to Alcon were improper.
   The protester states that the J&A prepared in connection with the orders
   was not adequately justified, and that the VA failed to request offers
   from as many potential sources as practicable. B&L argues that the
   agency's conclusion that only Alcon's equipment could meet VA's
   requirements was inaccurate and that B&L's Millennium equipment was the
   most advanced system on the market and could better satisfy VA's
   requirements. B&L argues that to the extent the orders to Alcon were
   justified based on urgency, the urgent circumstances were the result of
   the VA's lack of advance planning.

   The Competition in Contracting Act of 1984 (CICA) requires agencies to
   conduct their procurements using "full and open competition." 41 U.S.C.
   sect. 253(a)(1)(A). CICA, however, permits noncompetitive acquisitions in
   specified circumstances, such as when the agency's need for the services
   is of unusual and compelling urgency. Specifically, the exception provides
   as follows:

     An executive agency may use procedures other than competitive procedures
     only when . . . (2) the agency's need for the property or services is of
     such an unusual and compelling urgency that the Government would be
     seriously injured unless the executive agency is permitted to limit the
     number of sources from which it solicits bids or proposals.

   41 U.S.C. sect. 253(c)(2); see also FAR sect. 6.302-2(a)(2). As noted,
   this exception only allows an agency to "limit the number of sources," so
   that an agency may not simply ignore the potential for competition. See
   Worldwide Language Res., Inc.; SOS Int'l Ltd., B-296984 et. al., Nov. 14,
   2005, 2005 CPD para. 206 at 11. The mandate for agencies to effect some
   modicum of competition is reiterated in 41 U.S.C. sect. 253(e), which
   provides that when an agency utilizes other than competitive procedures
   based on unusual and compelling urgency, the agency "shall request offers
   from as many potential sources as is practicable under the circumstance."
   See also FAR sect. 6.302-2(c)(2). In addition, CICA provides that under no
   circumstances may noncompetitive procedures be used due to a lack of
   advance planning by contracting officials or concerns related to the
   amount of funds available to the agency. 41 U.S.C. sect. 253(f)(5)(A); see
   also FAR sect. 6.301(c).

   The agency has not demonstrated that it had a reasonable basis to make the
   sole-source orders here. While at least with respect to the VAMC Albany
   facility, the agency has demonstrated that it had an urgent need to
   replace the equipment due to the fact that patients were getting eye
   infections as a result of the use of the faulty medical equipment,[3] the
   agency has not reasonably demonstrated why it could not have opened the
   requirement up to an expedited limited competition among those firms that
   had expressed interest in the acquisition. There is no evidence in the
   record that the agency ever considered whether the cataract medical
   equipment proposed by B&L, or any other firm, would meet its urgent
   requirements. Moreover, B&L has responded in detail to the agency's
   sole-source justification by noting that its Millennium equipment is
   "state of the art" cataract surgery equipment and enjoys a significant
   market share, and by providing many technical details as to why its
   equipment is the best equipment available to meet VA's requirements. While
   VA was invited to respond to B&L's comments, it has provided no response
   to B&L's detailed comments as to why its equipment would satisfy VA's
   requirements.

   We sustain the protest. We do not recommend that the sole-source orders be
   disturbed inasmuch as they have been fully performed. We do recommend that
   the agency reimburse the protester its costs of pursuing this protest,
   including reasonable attorney's fees. 4 C.F.R. sect. 21.8(d) (2006). The
   protester should submit its certified claim for costs, detailing the time
   expended and the costs incurred, directly to the contracting agency within
   60 days of receipt of this decision. 4 C.F.R. sect. 21.6(f)(1).

   The protest is sustained.

   Gary L. Kepplinger

   General Counsel

   ------------------------

   [1] The agency justified the awards of sole-source contracts to Alcon for
   this equipment pursuant to 41 U.S.C. sect. 253(c)(2) (2000) and Federal
   Acquisition Regulation sect. 6.302-2(a)(2), and implemented this
   justification through the issuance of sole-source purchase orders to
   Alcon.

   [2] On June 14, VA also publicized an intent to award a sole-source
   contract to Alcon for ophthalmology medical equipment for cataract
   procedures for the VAMC Buffalo facility. After this protest was filed, VA
   terminated this purchase order.

   [3] The justification for urgency for the Syracuse VAMC is more
   problematic. In this regard, the record contains an e-mail from the doctor
   at the VAMC Syracuse facility indicating that the impetus for his purchase
   of this equipment was that the VAMC facilities in Albany and Buffalo were
   very much interested in procuring Alcon Infinity machines, "so [he]
   procured this by hopping on their coat tails so to speak," and that the
   equipment at that site had been "behaving fairly well." E-mail from VAMC
   Syracuse to B&L (June 19, 2006).