B-168712, SEP 24, 1970, 50 COMP GEN 209

B-168712: Sep 24, 1970

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PURSUANT TO A "DETERMINATION AND FINDINGS" THAT THE SOLE SOURCE PROCUREMENT OF THE STERILIZERS TO BE PURCHASED IS JUSTIFIED. IS RESTRICTIVE OF COMPETITION UNLESS NO OTHER ITEM WILL MEET THE GOVERNMENT'S MINIMUM REQUIREMENTS OR NO OTHER BUT THE SOLE SOURCE MANUFACTURER CAN PRODUCE AN ACCEPTABLE STERILIZER. AS THERE IS NOTHING PARTICULARLY UNIQUE ABOUT THE DESIGN OR MANUFACTURE OF THE BRAND NAME STERILIZER. ALTHOUGH THE JUSTIFICATION FOR THE PROCUREMENT IS A FINAL DETERMINATION. 1970: REFERENCE IS MADE TO A LETTER DATED FEBRUARY 16. THE SUBJECT RFP WAS ISSUED ON DECEMBER 16. IT WAS ALSO STATED THAT THE ITEMS: SHALL BE IN ACCORDANCE WITH THE SPECIFICATIONS CONTAINED IN PURCHASE DESCRIPTION NO. 7 DATED 24 NOVEMBER 1969.

B-168712, SEP 24, 1970, 50 COMP GEN 209

CONTRACTS - SPECIFICATIONS - RESTRICTIVE - PARTICULAR MAKE - "OR EQUAL" NOT SOLICITED THE SOLICITATION OF PROPOSALS ON A BRAND NAME BASIS WITHOUT AN "OR EQUAL" PROVISION IN ACCORDANCE WITH PARAGRAPH 1-1206.1(B) OF THE ARMED SERVICES PROCUREMENT REGULATION UNDER THE NEGOTIATION AUTHORITY CONTAINED IN 10 U.S.C. 2304(A) (7), AND PURSUANT TO A "DETERMINATION AND FINDINGS" THAT THE SOLE SOURCE PROCUREMENT OF THE STERILIZERS TO BE PURCHASED IS JUSTIFIED, IS RESTRICTIVE OF COMPETITION UNLESS NO OTHER ITEM WILL MEET THE GOVERNMENT'S MINIMUM REQUIREMENTS OR NO OTHER BUT THE SOLE SOURCE MANUFACTURER CAN PRODUCE AN ACCEPTABLE STERILIZER. THEREFORE, AS THERE IS NOTHING PARTICULARLY UNIQUE ABOUT THE DESIGN OR MANUFACTURE OF THE BRAND NAME STERILIZER, THE FACT THAT IT HAS BEEN PROVEN SATISFACTORY IN USE DOES NOT JUSTIFY THE SOLE SOURCE PROCUREMENT. ALTHOUGH THE JUSTIFICATION FOR THE PROCUREMENT IS A FINAL DETERMINATION, THE SOLE SOURCE SOLICITATION STATED IN THE REQUEST FOR PROPOSALS SHOULD BE ELIMINATED.

TO THE DIRECTOR, DEFENSE SUPPLY AGENCY, SEPTEMBER 24, 1970:

REFERENCE IS MADE TO A LETTER DATED FEBRUARY 16, 1970, FROM AN ASSISTANT COUNSEL, FURNISHING OUR OFFICE WITH AN ADMINISTRATIVE REPORT ON THE PROTEST BY SPECTRONICS CORPORATION UNDER REQUEST FOR PROPOSALS NO. DSA120- 70-R-1081, ISSUED BY THE DEFENSE PERSONNEL SUPPORT CENTER (DPSC), PHILADELPHIA, PENNSYLVANIA. IN ADDITION, BY LETTER DATED MAY 21, 1970, AND BY TELEPHONIC COMMUNICATION OF AUGUST 24, 1970, THE ASSISTANT COUNSEL FURNISHED US WITH SUPPLEMENTARY INFORMATION CONCERNING THE PROTEST.

THE SUBJECT RFP WAS ISSUED ON DECEMBER 16, 1969, PURSUANT TO THE REQUIRED "DETERMINATION AND FINDINGS" (D&F) EXECUTED BY THE CONTRACTING OFFICER ON DECEMBER 8, 1969. ON JUNE 26, 1970, RFP AMENDMENT NO. 0001 EXTENDED THE DATE SET FOR RECEIPT OF PROPOSALS TO JULY 3, 1970. THE RFP ORIGINALLY DESCRIBED THE PROCUREMENT AS CONSISTING OF 360 STERILIZERS "SURGICAL INSTRUMENT AND DRESSING PRESSURE, ELECTRICALLY AND FUEL BURNER HEATED, CORROSION-RESISTING METAL, AUTOMATIC CONTROL, 110 VOLT, 60 CYCLE, A-C." IT WAS ALSO STATED THAT THE ITEMS:

SHALL BE IN ACCORDANCE WITH THE SPECIFICATIONS CONTAINED IN PURCHASE DESCRIPTION NO. 7 DATED 24 NOVEMBER 1969. AMENDMENT NO. 3 DATED 28 SEPTEMBER 1960.

HOWEVER, THE REFERENCE TO PURCHASE DESCRIPTION NO 7 WAS DELETED BY AMENDMENT 0001, AND THE FOLLOWING WAS SUBSTITUTED THEREFOR: "SHALL BE SCIENTIFIC EQUIPMENT MANUFACTURING CORP. MODEL R-816." THE ABSENCE OF THE USUAL PHRASE "OR EQUAL" IS EXPLAINED BY REFERENCE TO THE PROVISION IN PARAGRAPH 1-1206.1(B) OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR):

THE WORDS "OR EQUAL" SHOULD NOT BE ADDED WHEN IT HAS BEEN DETERMINED IN ACCORDANCE WITH (A) ABOVE THAT ONLY A PARTICULAR PRODUCT MEETS THE ESSENTIAL REQUIREMENTS OF THE GOVERNMENT, AS, FOR EXAMPLE, *** (II) PROCUREMENT NEGOTIATED UNDER 3-207 FOR SPECIFIED MEDICINES OR MEDICAL SUPPLIES WHERE IT HAS BEEN DETERMINED THAT ONLY A PARTICULAR BRAND NAME PRODUCT WILL MEET THE ESSENTIAL REQUIREMENTS OF THE GOVERNMENT; *** .

THE NEGOTIATION AUTHORITY FOR THIS PROCUREMENT IS CONTAINED IN 10 U.S.C. 2304(A)(7) WHICH PROVIDES:

(A) PURCHASES OF AND CONTRACTS FOR PROPERTY OF SERVICES COVERED BY THIS CHAPTER SHALL BE MADE BY FORMAL ADVERTISING IN ALL CASES IN WHICH THE USE OF SUCH METHOD IS FEASIBLE AND PRACTICABLE UNDER THE EXISTING CONDITIONS AND CIRCUMSTANCES. IF USE OF SUCH METHOD IS NOT FEASIBLE AND PRACTICABLE, THE HEAD OF AN AGENCY, SUBJECT TO THE REQUIREMENTS FOR DETERMINATIONS AND FINDINGS IN SECTION 2310, MAY NEGOTIATE SUCH A PURCHASE OR CONTRACT, IF -

(7) THE PURCHASE OR CONTRACT IS FOR MEDICINE OR MEDICAL SUPPLIES;

THE REGULATORY IMPLEMENTATION OF THIS STATUTORY AUTHORITY IS FOUND IN ASPR 3-207, SUBSECTION 2 OF WHICH STATES AS FOLLOWS:

THE AUTHORITY OF THIS PARAGRAPH 3-207 SHALL BE USED ONLY WHEN THE FOLLOWING TWO REQUIREMENTS HAVE BEEN SATISFIED:

(I) SUCH SUPPLIES ARE PECULIAR TO THE FIELD OF MEDICINE, INCLUDING TECHNICAL EQUIPMENT SUCH AS SURGICAL INSTRUMENTS, SURGICAL AND ORTHOPEDIC APPLIANCES, X-RAY SUPPLIES AND EQUIPMENT, AND THE LIKE, BUT NOT INCLUDING PROSTHETIC EQUIPMENT; AND

(II) WHENEVER IT IS DETERMINED TO BE PRACTICABLE, SUCH ADVANCE PUBLICITY AS IS CONSIDERED SUITABLE WITH REGARD TO THE SUPPLIES INVOLVED AND OTHER RELEVANT CONSIDERATIONS SHALL BE GIVEN FOR A PERIOD OF AT LEAST 15 DAYS BEFORE MAKING A PURCHASE OF OR CONTRACT FOR SUPPLIES OR SERVICES, UNDER THIS AUTHORITY OF THIS PARAGRAPH 3-207, FOR MORE THAN $10,000.

THE D&F INDICATES THAT PROCUREMENT OF THESE SUPPLIES BY NEGOTIATION IS NECESSARY BECAUSE:

IT IS THE PROFESSIONAL MEDICAL DETERMINATION BY THE DEFENSE MEDICAL MATERIEL BOARD DATED 27 AUGUST 1969, THAT ONLY THE ABOVE PRODUCT AS MANUFACTURED BY SCIENTIFIC EQUIPMENT MANUFACTURING CORP. MEETS THE MINIMUM REQUIREMENTS OF THE GOVERNMENT. THIS STERILIZER IS AVAILABLE ONLY FROM SCIENTIFIC EQUIPMENT MFG. CORP.

THE PROCUREMENT HISTORY OF THIS ITEM IS FULLY SUMMARIZED IN THE CONTRACTING OFFICER'S REPORT DATED FEBRUARY 12, 1970:

AS THE NOMENCLATURE INDICATES, THE STERILIZER BEING PURCHASED MUST BE SUITABLE FOR STERILIZING, UNDER STEAM PRESSURE, DENTAL, LABORATORY, AND SURGICAL INSTRUMENTS AS WELL AS DRESSINGS, SUPPLIES, AND FLASKED SOLUTIONS. THE ITEM WAS FIRST STANDARDIZED BY THE DMMB 27 MARCH 1963 ON THE BASIS OF THE AMERICAN STERILIZER COMPANY'S MILITARY MODEL OF THEIR COMMERCIAL MODEL NO. 8816M. THE SIGNIFICANT DIFFERENCE BETWEEN THESE TWO MODELS IS THAT, IN THE MILITARY MODEL, THE ELECTRICAL AND MECHANICAL CONTROLS, WIRING, ETC., WERE MOVED TO THE SIDES OF THE UNIT SO THAT UNDER FIELD CONDITIONS, WITH NO ELECTRIC POWER SOURCE AVAILABLE, THE UNIT COULD BE READY FOR USE WITH A FIELD BURNER ASSEMBLY EMPLOYING A SOLID HYDROCARBON OR GASOLINE AS FUEL. BASED UPON ESSENTIAL CHARACTERISTICS ESTABLISHED BY DMMB AND INFORMATION FURNISHED BY THE AMERICAN STERILIZER COMPANY, PURCHASE DESCRIPTION NO. 1 WAS PROMULGATED ON 28 OCTOBER 1963. VARIOUS ADDITIONAL CHANGES IN THE SPECIFICATION WERE MADE, CULMINATING IN THE MILITARY SPECIFICATION MIL S-36338(DM) DATED 30 NOVEMBER 1964. THIS BECAME MIL-S-36338A 10 FEBRUARY 1967, INCORPORATING ALL CHANGES WHICH CAME ABOUT THROUGH PRODUCTION EXPERIENCE, FOR THE MOST PART THROUGH WAIVERS AND DEVIATIONS REQUESTED BY THE CONTRACTORS.

WHILE THE MILITARY SPECIFICATION DEVELOPMENT WAS IN PROGRESS, PURCHASE OF APPROXIMATELY 4,083 STERILIZERS WAS ACCOMPLISHED FROM JANUARY, 1964, THROUGH FEBRUARY, 1968. THREE FIRMS RECEIVED AWARDS FOR THE ITEM. AMERICAN STERILIZER COMPANY, A LARGE BUSINESS, WAS AWARDED CONTRACTS FOR 305 STERILIZERS BEFORE IT STOPPED BIDDING IN 1966. SCIENTIFIC, A SMALL BUSINESS FIRM UNTIL 8 AUGUST 1968, RECEIVED AWARDS FOR APPROXIMATELY 2,066 STERILIZERS. SPECTRONICS, THEN, AS NOW, A SMALL BUSINESS, RECEIVED THE BALANCE, OR ABOUT 1,712 ITEMS, UNDER THE CONTRACTS LISTED ON PAGE 2 OF THE PROTEST LETTER OF JANUARY 24. BETWEEN REVISIONS TO THE MIL SPEC ITSELF, NECESSARY MODIFICATIONS WERE ACCOMPLISHED BY PURCHASE DESCRIPTIONS, P.D. NO. 6, DATED 21 MARCH 1968, REVISED REQUIREMENTS FOR RACK, TRAYS, AND LINERS, ALLOWED A CYLINDRICAL RESERVOIR AS AN ALTERNATE, ESTABLISHED U.L. REQUIREMENTS FOR THE LINE CORD, CLARIFIED PERFORMANCE REQUIREMENTS FOR THE SELECTOR VALVE AND MODIFIED THE TEST FOR STERILIZATION OF SOLUTIONS. THIS SPECIFICATION CHANGE WAS ISSUED IN CONNECTION WITH RFP R-3073. HOWEVER, BEFORE THE INTENDED PURCHASE OF 245 STERILIZERS WAS MADE, THE ITEM WAS MADE LIMITED STANDARD AND THE PROCUREMENT WAS CANCELLED. AFTER AN ITEM IS MADE LIMITED STANDARD BY THE DMMB, THE ITEM IS NO LONGER CENTRALLY PROCURED; HOWEVER, DEPOT STOCKS OF THE ITEM CAN BE USED UNTIL EXHAUSTED. THE DECISION TO MAKE THE STERILIZER LIMITED STANDARD WAS MADE ON 10 JUNE 1968 AND WAS DIRECTLY RELATED TO THE BAD EXPERIENCE ENCOUNTERED IN FIELD USE OF THE ITEM. TOWARD THE END OF 1966, COMPLAINTS BEGAN TO COME IN FROM DEPOTS AND USING ACTIVITIES CONCERNING THE STERILIZER MANUFACTURED BY SPECTRONICS. THE DEFECTS COMPLAINED OF INVOLVED, FOR THE MOST PART, FAULTY DESIGN AND POOR WORKMANSHIP. PERHAPS THE MOST SIGNIFICANT DEFECT WAS THE FAULTY DESIGN OF THE SELECTOR VALVE WHICH CAUSED THE UNIT TO MALFUNCTION. SO WIDESPREAD WAS THIS PROBLEM THAT THE CONTRACTOR, SPECTRONICS, WAS REQUIRED TO FURNISH CORRECTION KITS CONSISTING OF PARTS, TOOLS, MANUALS, AND INSTRUCTIONS, FOR ALL DELIVERED AND UNDELIVERED UNITS. SPECTRONICS FURNISHED 942 CORRECTION KITS TO THE GOVERNMENT. THE BALANCE WAS INSTALLED IN THE FIELD BY THE USING ACTIVITIES AND THE UNDELIVERED QUANTITIES WERE INSTALLED BY THE CONTRACTOR. OTHER STERILIZERS WERE RETURNED TO DEPOTS FOR CREDIT OR REPAIR. IT IS SIGNIFICANT THAT THE COST TO THE GOVERNMENT JUST TO INSTALL THE SELECTOR VALVE IS ESTIMATED AT $15,000.00. THE CONTRACTOR'S COSTS ARE UNKNOWN. THE REPAIR KIT WAS DEVELOPED IN COORDINATION WITH SPECTRONICS AND WAS AN EXPEDIENCY TO GET THE UNITS TO FUNCTION. WHILE THE SELECTOR VALVE REPLACEMENT APPEARED TO WORK SATISFACTORILY AND THUS MADE THE UNITS USEABLE, OTHER AREAS OF COMPLAINT REMAINED UNCHANGED. FOR EXAMPLE, PROBLEMS REMAINED REGARDING STEAM LEAKAGE THROUGH DOOR SEALING DURING OPERATION; AND POOR DESIGN OF LOW WATER CUT OFF CAUSED LAG IN ACTIVATION THUS DAMAGING THE CHAMBER. THE APPROACH TO THESE PROBLEMS, ASIDE FROM PRACTICAL ANSWERS SUCH AS THE REPAIR KIT, WAS TO IMPROVE THE SPECIFICATION. HOWEVER, WHEN IT BECAME CLEAR THAT THE SPECIFICATION WAS NOT SUFFICIENTLY DEFINITIVE TO PREVENT THE PROCUREMENT OF SUB-STANDARD SUPPLIES FOR THE SYSTEM, THE DMMB RECLASSIFIED THE ITEM TO LIMITED STANDARD.

BECAUSE OF THE NEEDS OF THE SERVICES, IT BECAME NECESSARY TO REINSTATE THE ITEM DURING THE SUMMER OF 1969. DUE TO A LACK OF ASSURANCE THAT THE SPECIFICATION WOULD PRODUCE AN ACCEPTABLE ITEM, AND BECAUSE OF A SATISFACTORY HISTORY OF PERFORMANCE BY THE SCIENTIFIC ITEM UNDER ALL OF THE EXPECTED FIELD CONDITIONS, THE DMMB, UNDER THE AUTHORITY OF PARAGRAPH VA6 OF DOD DIRECTIVE 5154.18 DATED MAY 26, 1965, DESIGNATED MODEL R816 STERILIZER, MANUFACTURED BY SCIENTIFIC, AS THE SOLE SOURCE ITEM.

ALTHOUGH THE DMMB HAD DESIGNATED SOLE SOURCE, DPSC NEVERTHELESS HAS CONTINUED ITS EFFORTS TO DEVELOP SUFFICIENT DATA FOR A COMPETITIVE SPECIFICATION. IN THIS EFFORT A DRAFT DOCUMENT HAS BEEN PREPARED. WHILE IT WAS INTENDED TO ISSUE A SPECIFICATION FOR THE PRESENT PROCUREMENT CONSISTING PRIMARILY OF THE SOLE SOURCE DESIGNATION, THROUGH ERROR THE DRAFT SPECIFICATION WAS ATTACHED INSTEAD. SINCE IT IS INTENDED TO COORDINATE THIS SPECIFICATION WITH INDUSTRY PRIOR TO USE, TO AVOID THE TYPES OF PROBLEMS ENCOUNTERED IN THE PAST, THIS PURCHASE DESCRIPTION IS BEING WITHDRAWN AND THE PURCHASE WILL PROCEED ON THE BRAND NAME DESIGNATION, AS INTENDED. IT IS ESTIMATED THAT IT WILL TAKE APPROXIMATELY FOUR MONTHS TO PREPARE AND COORDINATE THE SPECIFICATION. AFTER THAT, INTERESTED FIRMS MAY OFFER QUALIFICATION SAMPLES FOR DPSC AND PROFESSIONAL (DMMB) EVALUATION. A NUMBER OF AREAS STILL BEING CONSIDERED FOR POSSIBLE INCLUSION IN THE SPECIFICATION ARE INDICTED IN THE FOLLOWING LIST:

A. POSSIBILITY OF ADDING A WATER-SIGHT GAGE TO REFLECT THE WATER LEVEL IN THE RESERVOIR.

B. USE OF SILICONE IMPREGNATED MATERIAL FOR DOOR GASKETS.

C. DESIGNATION OF A PRESSURE REQUIREMENT TO LOCK THE DOOR.

D. INTRODUCTION OF AN OPERATIONAL TEST TO INSURE LEFT AND/OR RIGHT OPERATION OF THE DOOR.

E. MODIFICATION OF DESIGN FOR BRACING OF FRONT PANEL WHEN SHELL IS REMOVED.

F. REDESIGN MANUAL FILLER/VENT VALVES.

G. ASSURE READY ACCESSIBILITY OF TEMPERATURE CONTROL CALIBRATION ADJUSTMENT.

H. CONSIDERATION OF AUDIBLE SIGNAL FOR END OF CYCLE PERIOD.

IT IS ANTICIPATED THAT WHEN THE CURRENT PROPOSED SPECIFICATION IS FULLY COORDINATED AND REVISED AS NECESSARY, AN ADEQUATE COMPETITIVE PROCUREMENT DOCUMENT WILL RESULT.

THE REPORT ALSO INCLUDES THE FOLLOWING STATEMENT:

IN THE PRESENT CASE, A PROFESSIONAL DETERMINATION HAS BEEN MADE THAT THIS COMPLEX PIECE OF EQUIPMENT SHOULD BE BOUGHT ONLY FROM SCIENTIFIC. THE DETERMINATION WAS MADE WITH KNOWLEDGE OF THE HISTORY OF THE ITEM, WHICH SHOWS THAT THE ONLY CONSISTENTLY ACCEPTABLE STERILIZER SUPPLIED IN THE PAST FOUR YEARS HAS BEEN MANUFACTURED BY SCIENTIFIC. THERE IS THE FURTHER KNOWLEDGE THAT WHEN THE STERILIZER IS NEEDED TO STERILIZE DRESSINGS OR SURGICAL INSTRUMENTS, ITS FUNCTION IS CRITICAL. PUT A DIFFERENT WAY, THERE IS NO OTHER SAFE AND ACCEPTABLE METHOD OF STERILIZING THE SUPPLIES AND INSTRUMENTS, AND IF THE STERILIZER SHOULD MALFUNCTION, ON BOARD SHIP FOR EXAMPLE WHERE REPAIR FACILITIES ARE LIMITED, THE USE OF THESE VALUABLE INSTRUMENTS WOULD BE LOST. WHILE IT IS REGRETTABLE THAT SOLE SOURCE DETERMINATIONS MUST BE MADE, IT IS OBVIOUS THAT THERE ARE OCCASIONS WHEN SUCH A DETERMINATION IS NECESSARY. RATHER THAN SUGGESTING ANY IMPROPRIETY OR PURPOSE OF EVASION, THE HISTORY OF THE PROCUREMENT OF THE STERILIZER INDICATES A CONTINUING EFFORT TO PROCURE THE ITEM ON A COMPETITIVE BASIS WITH AS DEFINITIVE A SPECIFICATION AS POSSIBLE. IT IS CONSIDERED THAT THE PLAN OUTLINED ABOVE IS THE BEST METHOD FOR ATTAINING THE STATED GOAL. ALTHOUGH THE NUMBER OF STERILIZERS BEING PURCHASED IS NOT GREAT IN COMPARISON WITH PREVIOUS PROCUREMENTS, THE NUMBER TO BE PURCHASED UNDER THIS SOLICITATION HAS BEEN REDUCED TO 205 SO THAT THE IMPACT OF THE PROCUREMENT IS AT THE ABSOLUTE MINIMUM. THE REDUCED FIGURE REPRESENTS THE ACTUAL STATED NEEDS OF THE SERVICES AND NO PROVISION HAS BEEN MADE FOR THE ANTICIPATED DRAW-DOWN WHICH SHOULD INCREASE WHEN WORD OF AVAILABILITY IS RECEIVED BY THE SERVICES. MEANWHILE, THE COORDINATION AND REVISION OF THE SPECIFICATION AND THE PROFESSIONAL EVALUATION OF ANY SAMPLES WILL PROCEED. WHEN SUCH EVALUATION INDICATES THAT ANOTHER FIRM IS ABLE TO PRODUCE A PROFESSIONALLY ACCEPTABLE STERILIZER UNDER OUR SPECIFICATION, THE SOLE SOURCE DETERMINATION WILL BE RESCINDED.

CONCERNING THE RESTRICTION OF THIS PROCUREMENT TO A SOLE SOURCE OF SUPPLY, THE ACTION HAS BEEN TAKEN PURSUANT TO A DETERMINATION BY THE DEFENSE MEDICAL MATERIEL BOARD (DMMB) UNDER THE AUTHORITY CONTAINED IN PARAGRAPH V.A.6 OF DEPARTMENT OF DEFENSE DIRECTIVE 5154.18, MAY 26, 1965, WHICH GIVES THE DMMB AUTHORITY TO: DETERMINE THOSE ITEMS FOR WHICH SOURCES OF SUPPLY MUST BE LIMITED TO SELECTED PRODUCERS TO MEET SERVICE PROFESSIONAL REQUIREMENTS AND DESIGNATE THE ACCEPTABLE SOURCE OF SUPPLY.

UNDER THIS DIRECTIVE, A DMMB DETERMINATION CONCERNING A PROFESSIONAL MEDICAL END ITEM WOULD CONSTITUTE A TECHNICAL OR SCIENTIFIC DECISION AS TO THE MINIMUM NEEDS OF THE GOVERNMENT. SEE B-150387, JULY 9, 1963.

THAT PORTION OF THE D&F CONSTITUTING THE "FINDINGS" STATES AS FOLLOWS:

B. IN VIEW OF THE ABOVE, IT IS IN THE BEST INTEREST OF THE GOVERNMENT TO NEGOTIATE SOLE SOURCE BASED ON PROFESSIONAL EVALUATIONS, THAT ONLY THE ABOVE ITEM MEETS THE PROFESSIONAL MEDICAL REQUIREMENTS OF THE MILITARY SERVICES.

ON THE BASIS OF THESE FINDINGS, THE DEFENSE PERSONNEL SUPPORT CENTER (DPSC) CONTRACTING OFFICER IN HIS "DETERMINATION" STATED THAT THE USE OF A NEGOTIATED CONTRACT IS JUSTIFIED BECAUSE:

THE PURCHASE IS FOR MEDICINES OR MEDICAL SUPPLIES FOR WHICH PROCUREMENT BY FORMAL ADVERTISING IS NOT FEASIBLE AND PRACTICABLE.

THIS DETERMINATION IS FINAL UNDER 10 U.S.C. 2310(B) WHICH READS AS FOLLOWS:

(B) EACH DETERMINATION OR DECISION UNDER CLAUSES (11)-(16) OF SECTION 2304(A), SECTION 2306(C), SECTION 2306(G)(1), SECTION 2307(C) OR SECTION 2313(C) OF THIS TITLE AND A DECISION TO NEGOTIATE CONTRACTS UNDER CLAUSES (2), (7), (8), (10), (12), OR FOR PROPERTY OR SUPPLIES UNDER CLAUSE (11) OF SECTION 2304(A), SHALL BE BASED ON A WRITTEN FINDING BY THE PERSON MAKING THE DETERMINATION OR DECISION, WHICH FINDING SHALL SET OUT FACTS AND CIRCUMSTANCES THAT (1) ARE CLEARLY ILLUSTRATIVE OF THE CONDITIONS DESCRIBED IN CLAUSES (11)-(16) OF SECTION 2304(A), (2) CLEARLY INDICATE WHY THE TYPE OF CONTRACT SELECTED UNDER SECTION 2306(C) IS LIKELY TO BE LESS COSTLY THAN ANY OTHER TYPE OR THAT IT IS IMPRACTICABLE TO OBTAIN PROPERTY OR SERVICES OF THE KIND OR QUALITY REQUIRED EXCEPT UNDER SUCH A CONTRACT, (3) SUPPORT THE FINDINGS REQUIRED BY SECTION 2306(G)(1), (4) CLEARLY INDICATE WHY ADVANCE PAYMENTS UNDER SECTION 2307(C) WOULD BE IN THE PUBLIC INTEREST, (5) CLEARLY INDICATE WHY THE APPLICATION OF SECTION 2313(B) TO A CONTRACT OR SUBCONTRACT WITH A FOREIGN CONTRACTOR OR FOREIGN SUBCONTRACTOR WOULD NOT BE IN THE PUBLIC INTEREST, OR (6) CLEARLY AND CONVINCINGLY ESTABLISH WITH RESPECT TO THE USE OF CLAUSES (2), (7), (8), (10), (12), AND FOR PROPERTY OR SUPPLIES UNDER CLAUSE (11) OF SECTION 2304(A), THAT FORMAL ADVERTISING WOULD NOT HAVE BEEN FEASIBLE AND PRACTICABLE. SUCH A FINDING IS FINAL AND SHALL BE KEPT AVAILABLE IN THE AGENCY FOR AT LEAST SIX YEARS AFTER THE DATE OF THE DETERMINATION OR DECISION. A COPY OF THE FINDING SHALL BE SUBMITTED TO THE GENERAL ACCOUNTING OFFICE WITH EACH CONTRACT TO WHICH IT APPLIES.

ALTHOUGH WE MAY BE PRECLUDED BY THIS STATUTE FROM DISTURBING THE BASES UPON WHICH THE PROCUREMENT WAS JUSTIFIED, WE HAVE SERIOUS RESERVATIONS CONCERNING THE SOLE SOURCE ASPECT OF THE CONTEMPLATED AWARD.

AS STATED ABOVE, THE PROCUREMENT OF THE DESIRED STERILIZERS ON A BRAND NAME RATHER THAN ON AN "OR EQUAL" BASIS STEMMED FROM THE DMMB DETERMINATION AND ASPR 1-1206.1(B). DECISIONS OF OUR OFFICE HAVE CONSIDERED THAT ASPR SECTION, AND WE BELIEVE IT RELEVANT TO COMMENT ON THOSE DECISIONS. IN B-148288, JUNE 1, 1962, WE REFERRED TO ASPR 1-1206 AND HELD:

THESE REGULATIONS APPEAR TO BE IN ACCORD WITH THE DECISIONS OF THIS OFFICE WHICH ARE DIRECTED TO PROHIBITING THE SOLICITATION OF BIDS OR PROPOSALS ON ANY BASIS WHICH WILL UNDULY OR UNNECESSARILY RESTRICT COMPETITION. IN EFFECT, THEY PROHIBIT CONTRACTING AGENCIES FROM LIMITING BIDS OR PROPOSALS TO ONE OR MORE NAMED BRANDS UNLESS NO OTHER ITEM WILL MEET THE AGENCY'S NEEDS OR NO OTHER MANUFACTURER IS CAPABLE OF PRODUCING A SIMILAR ITEM WHICH WILL MEET THE AGENCY'S NEEDS. *** .

IN DISCUSSING THE AVAILABLE SOURCES OF SUPPLY FOR THE ITEM IN QUESTION, WE NOTED THAT:

*** SUBSEQUENT INFORMATION INDICATING THAT OTHER MANUFACTURERS MIGHT BE CAPABLE OF PRODUCING ACCEPTABLE ITEMS MADE IT MANDATORY, IN OUR OPINION, THAT SUCH MANUFACTURERS BE GIVEN THE OPPORTUNITY TO COMPETE. *** .

CITING THAT DECISION, IN B-152158, NOVEMBER 18, 1963, WE TOOK THE SAME VIEW AGAINST THE UNNECESSARY AND IMPROPER RESTRICTION OF COMPETITION ATTENDANT TO A NEGOTIATED PROCUREMENT ON A BRAND NAME BASIS AND STATED:

WE AGREE THAT THE ARMED SERVICES PROCUREMENT REGULATION, SEC. 1-1206, PROHIBITS THE SOLICITATION OF PROPOSALS ON ANY BASIS WHICH WILL UNDULY OR UNNECESSARILY RESTRICT COMPETITION; HOWEVER, THIS REGULATION ALSO PROVIDES IN SEC. 1-1206.1 (B) THAT A PURCHASE DESCRIPTION UTILIZING A BRAND NAME ONLY MAY BE USED WHERE NO OTHER ITEM OR MANUFACTURER WILL MEET THE AGENCIES' NEEDS. IN THIS REGARD WHERE PROPOSALS ARE SOLICITED ON A BRAND NAME BASIS WITHOUT AN "OR EQUAL" PROVISION AND SUBSEQUENT INFORMATION INDICATES THAT OTHER MANUFACTURERS MAY BE ABLE TO PRODUCE ACCEPTABLE ITEMS, IT HAS BEEN OUR OPINION THAT SUCH MANUFACTURERS MUST BE GIVEN THE OPPORTUNITY TO COMPETE. SEE B-148288, JUNE 1, 1962.

CONTINUING THIS LINE OF REASONING, IN B-165555, JANUARY 24, 1969, WE DID NOT OBJECT TO THE USE OF A BRAND NAME PURSUANT TO ASPR 1-1206 SINCE THE BRAND NAME DESIGNEE WAS THE ONLY MANUFACTURER WHICH HAD THE PROVEN ABILITY TO FURNISH THE DESIRED ITEM.

OTHER DECISIONS OF OUR OFFICE, SET OUT BELOW, HAVE CONSIDERED VARIOUS BASES FOR RESTRICTING COMPETITION TO A SINGLE SOURCE OF SUPPLY:

1. TIME IS OF THE ESSENCE AND, AS SUCH, WOULD NOT PERMIT TESTING OF A PRODUCT OFFERED BY A SOURCE OTHER THAN A SOLE SOURCE TO MEET THE DELIVERY SCHEDULE. B-167661(1), MAY 5, 1970; B-158550, JUNE 29, 1966; B-158705, JUNE 6, 1966; B-151310, JUNE 25, 1963.

2. ITEM DESIRED IS UNIQUE AND IS THE ONLY KNOWN ITEM WHICH WOULD MEET THE GOVERNMENT'S NEEDS. B-166325, MAY 28, 1969; B-163099, APRIL 19, 1968; B- 151310, SUPRA; 33 COMP. GEN. 524 (1954).

3. DATA UNAVAILABLE FOR COMPETITIVE PROCUREMENT. B-161031, JUNE 1, 1967; B-151416, JUNE 26, 1963.

4. NECESSITY THAT THE DESIRED ITEM MANUFACTURED BY ONE SOURCE BE COMPATIBLE AND INTERCHANGEABLE WITH EXISTING EQUIPMENT. B-152158, SUPRA.

WITH THE FOREGOING IN MIND, IT IS PERTINENT TO OBSERVE HERE THAT IT HAS BEEN REPRESENTED TO OUR OFFICE THAT THERE IS NOTHING PARTICULARLY UNIQUE ABOUT THE DESIGN OF MANUFACTURE OF THE STERILIZER IN QUESTION. IN FACT, WE HAVEN BEEN ADVISED THAT THE DESIRED STERILIZER IS ONE OF THE SIMPLEST TYPE OF PORTABLE STERILIZERS AVAILABLE. IN ADDITION, WE WERE INFORMED THAT, AT THE TIME THE PROCUREMENT WAS INSTITUTED, ONLY THREE FIRMS MANUFACTURED THE TYPE OF STERILIZER DESIRED. SINCE, AS STATED ABOVE, THE SPECTRONICS STERILIZER HAD EXPERIENCED FIELD FAILURES, AND THE AMERICAN STERILIZER COMPANY DID NOT WISH TO BID, A SOLE SOURCE PROCUREMENT WAS REQUESTED BY IMMB. ALSO, WE NOTE THAT A PROPOSED MILITARY SPECIFICATION DESIGNED TO BROADEN COMPETITION FOR FUTURE PROCUREMENTS IS BEFORE INDUSTRY FOR COMMENTS.

WE BELIEVE THAT A SATISFACTORY BASIS HAS NOT BEEN ESTABLISHED BY THE RECORD TO SUPPORT THE CONTEMPLATED SOLE SOURCE PROCUREMENT. IT IS CLEAR THAT SEVERAL COMPANIES HAVE THE ABILITY TO MANUFACTURE THE DESIRED STERILIZER. THE FACT THAT A STERILIZER MANUFACTURED BY ONE COMPANY HAS PROVEN SATISFACTORY IN USE IS NOT SUFFICIENT TO JUSTIFY A SOLE SOURCE PROCUREMENT OF THE SAME STERILIZER TO THE EXCLUSION OF OTHERS. SEE B- 166555, JUNE 3, 1969. WE HAVE LEARNED THAT SEVERAL GOVERNMENT AGENCIES PROCURE SIMILAR PORTABLE STERILIZERS BY FORMAL ADVERTISING OR COMPETITIVE NEGOTIATION. WE RECOGNIZE THAT THE STERILIZERS WILL BE USED ON BOARD SHIP AND, FOR THAT REASON, OTHER BRANDS MIGHT REQUIRE SOME ADJUSTMENTS AND MODIFICATIONS. BUT THIS FACTOR, ALONE, MAY NOT JUSTIFY THE ELIMINATION OF OTHER STERILIZERS FROM COMPETITION. SEE 47 COMP. GEN. 175,181 (1967), WHEREIN WE STATED, QUOTING FROM 44 COMP. GEN. 27 (1964):

*** THE QUESTION OF WHETHER A COMPANY IS AT ANY POINT IN TIME A SOLE SOURCE OF A GIVEN ITEM IS DIFFICULT TO RESOLVE, SINCE ANOTHER FIRM MAY HAVE PRIVATE INTENTIONS TO ENTER THE MARKET AT THE FIRST OPPORTUNITY, OR ONE MAY BE WILLING TO ALTER ITS COMMERCIAL OR STANDARD EQUIPMENT IN ORDER TO COMPETE FOR A PARTICULAR PROCUREMENT OR BUSINESS. ***

WE APPRECIATE THAT DPSC MAY HAVE NO OPTION OTHER THAN TO ADHERE TO THE JUDGMENT OF IMMB. HOWEVER, IN VIEW OF THE PARTICULAR ASPECTS OF THIS PROTEST AS DISCUSSED ABOVE, WE RECOMMEND THE ELIMINATION OF THE SOLE- SOURCE RESTRICTION STATED IN RFP-1081. SINCE WE REGARD THIS MATTER AS ONE INVOLVING A PROCUREMENT RESPONSIBILITY OF YOUR AGENCY, WE WOULD APPRECIATE ADVICE AS TO THE ACTIONS CONTEMPLATED OR TAKEN WITH REFERENCE TO THE PROCUREMENT OF THE SUBJECT STERILIZERS.