Pfizer, Incorporated, B-276362, June 6, 1997

B-276362 Jun 06, 1997 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights Agency decision to use only price and price-related evaluation factors is unobjectionable where. Agency reasonably determines that competing drugs are essentially technically equal. The solicitation was issued with evaluation criteria consisting only of price factors. [1] Pfizer argues that the agency should have included technical criteria to take into consideration certain allegedly meaningful differences in the competing drugs. BACKGROUND This RFQ was issued as part of a broader program underway at VA to standardize pharmaceuticals and medical/surgical items in order to achieve concentrated buying power. A 10-member medical advisory panel (MAP) was created. The MAP is composed of practicing VA physicians from various disciplines who serve 2-year terms. View Decision Matter of: Pfizer, Incorporated File: B-276362 Date: June 6, 1997 DIGEST Attorneys DECISION Pfizer, Incorporated protests the evaluation criteria in a request for quotation (RFQ) for a blanket purchase agreement (BPA) issued by the Department of Veterans Affairs (VA) for a drug class referred to as long-acting alpha blockers. The solicitation was issued with evaluation criteria consisting only of price factors. [1] Pfizer argues that the agency should have included technical criteria to take into consideration certain allegedly meaningful differences in the competing drugs. We deny the protest. BACKGROUND This RFQ was issued as part of a broader program underway at VA to standardize pharmaceuticals and medical/surgical items in order to achieve concentrated buying power. Since the Veterans Health Administration (VHA) expends approximately $1 billion on pharmaceuticals each year, the VA seeks to accomplish its "greater goals of quality care, access, customer service and cost efficiency" by creating "national formularies" for various drugs. [2] In order to facilitate these goals, the VHA created a Pharmacy Benefits Management (PBM) section which, among other tasks, assists in the effort to create a national formulary. To assist the PBM, a 10-member medical advisory panel (MAP) was created. The MAP is composed of practicing VA physicians from various disciplines who serve 2-year terms. The pharmacologic treatment guidelines developed by the MAP provide guidance for standardized research-based care across the VA. THE SOLICITATION The long-acting alpha blockers which are the subject of this solicitation are used in the treatment of hypertension (HTN) and benign prostatic hyperplasia (BPH). There are only two manufacturers of these drugs: Pfizer, which manufactures doxazosin, and Abbott Laboratories, which manufactures terazosin; both companies have Federal Supply Schedule (FSS) contracts that encompass the drugs. The RFQ was issued pursuant to Federal Acquisition Regulation Sec. 13.202(c)(3) and a clause in the companies' FSS contracts in which they agree to enter into BPAs. See Intelligent Decisions, Inc., B-274626, B-274626.2, Dec. 23, 1996, 97-1 CPD Para. 19 at 5, recon. denied, B-274626.3, May 15, 1997, 97-1 CPD Para. The RFQ, as originally issued, identified the VA's estimated volume in various doses of the drug. [3] The RFQ provided that, in exchange for lower drug prices than those provided in the FSS contracts, the VA would give the selected drug national formulary status. The firm receiving the BPA would be required to provide, at no additional cost, standard starter kits to facilitate conversion (switching) from the patient's current medication to the chosen one. The BPA was to last from award to the end of December 1997. The solicitation provided that a BPA would be issued to the offeror meeting the RFQ's requirements, whose quote was most advantageous to the government and represented the best overall expected value. The VA reserved the right to cancel the RFQ if the overall advantage of the quotations received was minimal and provided no significant cost savings (i.e., relative to the extant FSS prices). The cost of switching was to be used in determining overall value only where there was merely a nominal pricing advantage of one quote over the other. Price was to be evaluated on the basis of a proposed aggregate price for all line items with additional consideration for scored tablets. [4] No other evaluation criteria were set forth. Prior to the closing date, Pfizer submitted an offer and protested the terms of the solicitation, primarily arguing that the evaluation criteria were flawed. Since various alpha blockers are not identical, Pfizer presumed that the VA intended to consider the differences in a technical evaluation but had improperly failed to disclose in the solicitation how it intended to evaluate them. As noted above, after receiving the protest, the VA issued a revised version of the solicitation to make plain that it was an RFQ under which price was the only evaluation criterion.