ViroMed Laboratories, Inc.

B-289959.7: Dec 19, 2003

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ViroMed Laboratories, Inc. protests the Department of the Army's award of a contract to the Center for Disease Detection (CDD) under request for proposals (RFP) No. DADA10-01-R-0009 to perform various laboratory testing and related services. ViroMed protests that the agency improperly evaluated CDD's and ViroMed's technical proposals as substantially equal, failed to perform a proper price realism analysis, and failed to properly evaluate the offerors' past performance.

We deny the protest.

B-289959.7, ViroMed Laboratories, Inc., December 19, 2003




DOCUMENT FOR PUBLIC RELEASE
The decision issued on the date below was subject to a GAO Protective Order. This redacted version has been approved for public release.
Decision

Matter of:

File:

Date:

















DECISION

ViroMed Laboratories, Inc. protests the Department of the Army's award of a contract to the Center for Disease Detection (CDD) under request for proposals (RFP) No. DADA10-01-R-0009 to perform various laboratory testing and related services. ViroMed protests that the agency improperly evaluated CDD's and ViroMed's technical proposals as substantially equal, failed to perform a proper price realism analysis, and failed to properly evaluate the offerors' past performance.

We deny the protest.

BACKGROUND

This solicitation was issued by the U.S. Army Medical Command (MEDCOM) at Fort Sam Houston, Texas in May 2001, seeking fixed-unit-price proposals to perform various blood testing and related services for a base period and four 1'year option periods.[1] The solicitation provided that award would be based on the proposal offering the best value to the government and established the following evaluation factors: technical quality,[2] past/present performance, proficiency testing,[3] financial capability and price. Agency Report, Tab C, at 2. The solicitation advised offerors that the combined non-price factors would be significantly more important than price. Id.

With regard to price, offerors were required to propose fixed unit prices for each of the contract line item numbers (CLINs) listed in the solicitation schedule.[4] The solicitation listed estimated quantities for each CLIN,[5] and total proposed prices were established by multiplying each offeror's fixed prices for each CLIN by the associated quantities for each contract period and summing the results.

Five proposals were submitted by the initial closing date in June 2001. ViroMed, CDD, and a third offeror made oral presentations to the agency in July.[6] Following oral presentations CDD and ViroMed each performed proficiency panel testing on two 20'sample panels of specimens provided by the agency.[7] The agency concluded that both offerors' performance regarding the sample test requirements was satisfactory. Agency Report, Tab P, at 3.

Shortly after oral presentations, two members of the agency's technical evaluation team (TET) made an unauthorized site visit to CDD's facility.[8] Due to this visit, the contracting officer relieved the TET members of their duties and appointed a new TET in December 2001. Agency Report, Tab A, at 2. Thereafter, the new TET reviewed the videotapes of the oral presentations and prepared written discussion questions for ViroMed and CDD. [9] ViroMed and CDD subsequently provided written responses to these discussion questions. Agency Report, Tabs, I, J, K. The agency also conducted oral discussions with both offerors. Agency Report, Tab A, at 2-3. Proposal revisions were submitted by both offerors in January 2002. Upon evaluation of these proposals, the agency found them to be substantially equal with regard to non-price factors, and determined that CDD's proposal offered the lowest price.[10] Accordingly, CDD's proposal was selected for award on the basis of its lower proposed price.

Following a debriefing, ViroMed filed a protest with our Office in February 2002.
Rather than submitting an agency report responding to ViroMed's protest, the contracting officer advised our Office, by letter dated March 19, 2002, that the agency intended to take various corrective actions, including: requesting CDD to re'present the omitted portion of its oral presentation, performing a new technical evaluation and a new past performance evaluation, and making a new source selection decision. Agency Report, Tab S. The contracting officer's corrective action letter further advised the offerors: –I do not anticipate a new round of discussions. Instead, the agency intends to rely upon the discussions held previously with the offerors.— Id. ViroMed did not challenge any aspect of the agency's corrective actions.[11]

Consistent with the agency's March 19 letter, the agency taped CDD's re'presentation of the portion of its earlier oral presentation that had not been recorded. Thereafter, the TET team re-evaluated the proposals, again concluding that the proposals were
substantially equal with regard to non-price factors. The results of this evaluation were as follows:



ViroMed

CDD

Technical Quality
-Understanding of Work
-Management Capability
-Quality Control


Exceptional
Exceptional
Exceptional


Exceptional
Exceptional
Acceptable

Past Performance

Excellent

Excellent

Proficiency Panel Testing

Passed

Passed

Financial Capability

Sufficient

Sufficient

Price[12]

$17,809,189

$16,855,623



















[13]



[14]

[15] [16] Id. [17]





de novo J & E Assocs., Inc. ESCO, Inc.








[18]

[19]



Rodgers Travel, Inc. Star Mountain, Inc.





Id.

Id. Id. Id. Id.










[1] This procurement is part of an ongoing Army program to test blood samples drawn from U.S. soldiers. Under the solicitation, the contractor is required to perform various laboratory tests with regard to the human immunodeficiency virus (HIV), measles antibody, human papillomavirus (HPV), varicella antibody, rubella antibody, and the mumps antibody. Agency Report, Tab F, at 1. The solicitation also requires that the contractor provide an automated system to create and store data files, and to securely transfer information to authorized facilities. Id. ViroMed was the incumbent contractor at the time the solicitation was issued, and has continued to perform the solicitation requirements during the nearly 2-year period that award has been delayed due to ViroMed's various protests and the agency's multiple corrective actions.
[2] Under the evaluation factor for assessing technical quality, the solicitation established the following equally weighted subfactors: understanding the scope of work, management capability, and quality control. Agency Report, Tab C, at 2.
[3] With regard to this evaluation factor, the solicitation provided that offerors within the competitive range following oral presentations would be required to perform testing on two 20-specimen panels to demonstrate testing proficiency. Agency Report, Tab C, at 5-6. Evaluation of proposals regarding this factor was performed on a pass/fail basis.
[4] The solicitation schedule contained the following CLINs: HIV initial screening tests, duplicate HIV tests, HIV Western Blot tests, blood donor confirmatory testing, measles antibody, HPV, varicella antibody, rubella antibody, mumps antibody, and automation support. Agency Report, Tab D, at 1-7.
[5] HIV-related testing requirements constituted a significant majority of the solicitation's testing requirements. For example, the solicitation estimated that more than 530,000 HIV-related tests would be required during the base period, while only 830 blood bank confirmatory tests would be required. Agency Report, Tab D, at 2-7.
[6] Two of the five offerors withdrew from the competition prior to oral presentations. The third offeror was determined to be outside the competitive range following oral presentations.
[7] The solicitation provided that the panels were to be picked up by the contractor on July 11 and returned on July 16. Agency Report, Tab C, at 5. The solicitation also stated: –Test Panel results must be accompanied by a certification, signed by a laboratory supervisor, certifying that the administration of the prescribed tests were accomplished in the precise manner that the offeror would employ in the performance of this contract.— Id.
[8] CDD's facility is located within a few miles of the MEDCOM offices in San Antonio, Texas.
[9] In reviewing the videotape of CDD's oral presentation, the TET found that the tape contained an 18-minute gap, which appeared to have been caused by someone depressing the video recorder's –pause— button during CDD's presentation. Agency Report, Tab A, at 2. The agency's discussion questions sought information from CDD regarding solicitation requirements that had, apparently, been addressed during the 18-minute period the video recorder had not operated.
[10] ViroMed's proposed price was $21,994,203; CDD's proposed price was $21,361,184, approximately 3 percent lower than ViroMed's. Agency Report, Tab P, at 3.
[11] As a result of the delay caused by the protest and the agency's corrective action, ViroMed, the incumbent contractor, continued to perform the solicitation requirements.
[12] In performing the various corrective actions discussed throughout this decision, the agency's price evaluations appear to assume that the contract performance period automatically decreased to reflect the delay in contract award caused by ViroMed's various protests and the agency corrective actions. Accordingly, although none of the agency's corrective actions included a request for revised price proposals, ViroMed's and CDD's evaluated prices decline under each re-evaluation. Since the solicitation was never amended to reflect a shorter contract performance period, this approach may not have been justified. However, the record is clear--and ViroMed does not dispute--that CDD's proposal offers the lowest price under all of the performance scenarios, including, most significantly, the full performance period stated in the solicitation. In light of our determination, discussed below, that the agency reasonably evaluated ViroMed's and CDD's technical proposals as substantially equal, along with the fact that CDD's proposal was properly evaluated as offering the lower price with regard to any of the evaluated contract performance periods, ViroMed was not prejudiced by the agency's approach. Further, in response to the agency's various corrective actions, ViroMed has never filed a protest asserting that the agency should, additionally, amend the solicitation to reflect a shorter performance period.
[13] The agency concluded that neither ViroMed nor CDD had previously provided adequate documentation to the agency regarding the solicitation's FDA licensing/registration requirements. Agency Report, Tabs AM, AN.
[14] Again, the delay caused by ViroMed's protest and agency corrective action resulted in ViroMed's continued performance of the solicitation requirements.
[15] In its June 2, 2003 protest, ViroMed, for the first time, asserted that CDD's proposal failed to comply with the solicitation requirement to submit a certification with the proficiency panel testing performed by the offerors in July 2001. As noted above, the solicitation required that the test panel results –must be accompanied by a certification . . . that the administration of the prescribed tests were accomplished in the precise manner that the offeror would employ in the performance of this contract.— Agency Report, Tab C, at 6. In its June 2, 2003 protest, ViroMed maintains that CDD could not possibly have complied with this certification requirement since CDD's proposal expressly provided that CDD intended to perform the vast majority of the contract's testing requirements using [deleted] system that CDD had not installed, or even acquired, at the time the July 2001 proficiency panel tests were performed. See Agency Report, Tab AD, at 3 (letter from CDD to the agency stating, –The first of our [deleted] systems will be installed on or about the second week of September 2001.—) However, ViroMed's counsel, who were admitted to the protective order for this protest, received all of the information discussed above in the September 2002 agency report that responded to ViroMed's August 2002 protest. Accordingly, to comply with our Bid Protest Regulations regarding timely submission of protest issues, ViroMed was required to identify CDD's alleged failure to comply with the certification requirement no later than 10 days after receiving the September 2002 agency report. Bid Protest Regulations, 4 C.F.R. 21.2(a)(2) (2003). Since ViroMed failed to do so, this matter is not timely raised, and we will not further consider it.
[16] Once again, the delay resulted in an extension of ViroMed's ongoing performance of the solicitation requirements.
[17] On July 24, ViroMed submitted a request that our Office recommend reimbursement of the costs ViroMed has incurred in filing and pursuing its various protests. To the extent ViroMed is requesting reimbursement for costs incurred in response to any protest other than the June 2, 2003 protest, the request is not timely and will not be further addressed. 4 C.F.R. 21.8. With regard to the agency's correction of mathematical/clerical errors in its calculation of ViroMed's price, the record is now clear that CDD was the lower priced offeror both before and after correction of the errors; thus, ViroMed's identification of this matter in its protest, notwithstanding the agency's decision to take corrective action, was not material to the source selection decision. Accordingly, we do not view ViroMed's protest regarding this issue as being clearly meritorious, which is a prerequisite to our recommendation of cost reimbursement. See, e.g., KENROB & Assocs., Inc.--Costs, B-291573.7, Apr. 25, 2003, 2003 CPD 99. On this record, we decline to recommend reimbursement of ViroMed's protest costs.
[18] Similarly, nothing in ViroMed's protest provides a basis for challenging the agency's assessment that, although ViroMed's quality control plan contained greater detail, there was nothing in its plan making it substantively superior to CDD's quality control plan. In this regard, the solicitation required that offerors –[p]rovide an overview of your methodology of identifying, resolving, and preventing quality assurance problems to include documentation, record maintenance and reporting of quality related problems.— Agency Report, Tab C, at 7. As noted above, the agency concluded that both offerors' quality control plans –completely fulfilled the solicitation requirements.— Agency Report, Tab P, at 3. ViroMed's protest fails to identify any portion of CDD's plan that fails to meet the solicitation requirements, nor does it identify any aspect of its own plan that substantively meets or exceeds the solicitation requirements in a manner beneficial to the agency. Accordingly, we find no basis to question the agency's determination that both quality control plans were substantively equal.
[19] Specifically, the solicitation contemplated a total of 830 blood bank tests per year, which constitutes less than 1 percent of the total testing requirements. Further, the fixed prices offered by both ViroMed's and CDD's proposals to perform the solicitation's automation support requirements constitute a minimal portion of their total proposed prices.

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