Triad Isotopes, Inc.

B-411360 Jul 16, 2015 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights Triad Isotopes, Inc., of Orlando, Florida, protests the decision of the Department of Veterans Affairs (VA) to issue request for quotations (RFQ) No. VA247-15-Q-0330, for the acquisition of radiopharmaceuticals, as a small business set-aside. Triad contends that the agency's market research did not provide a reasonable basis to conclude that the agency would receive proposals from two or more small business concerns, and therefore, argues that the requirement should be competed on an unrestricted basis. We sustain the protest. We sustain the protest. View Decision 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:      Triad Isotopes, Inc. File:                B-411360 Date:              July 16, 2015 Kelley Doran, Esq., W. Barron A. Avery, Esq., Michael P. Giordano, Esq., and Jeffrey M. Pederson, Esq., Baker & Hostetler LLP, for the protester. Harold W. Askins III, Esq., Department of Veterans Affairs, for the agency. Heather Weiner, Esq., and Jonathan L. Kang, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Protest is sustained where the agency’s market research was insufficient to conclude that the agency would likely receive quotations from at least two responsible small business concerns that could meet the requirements in the RFQ at a fair market price, and therefore, the agency’s decision to restrict the solicitation to small business concerns was unreasonable. DECISION Triad Isotopes, Inc., of Orlando, Florida, protests the decision of the Department of Veterans Affairs (VA) to issue request for quotations (RFQ) No. VA247-15-Q-0330, for the acquisition of radiopharmaceuticals, as a small business set-aside.  Triad contends that the agency’s market research did not provide a reasonable basis to conclude that the agency would receive proposals from two or more small business concerns, and therefore, argues that the requirement should be competed on an unrestricted basis.  We sustain the protest. BACKGROUND On April 2, 2015, the VA issued the current RFQ for the manufacture and delivery of radiopharmaceutical[1] and non-radiopharmaceutical items, as a small business set‑aside, and designated North American Industry Classification System (NAICS) code 325412, Pharmaceutical Preparation Manufacturing, which has a corresponding size standard of 750 employees, as the size standard for small business participation in the procurement.  RFQ at 2.  The solicitation also states that the acquisition is to be conducted under the commercial item and simplified acquisition procedures of Federal Acquisition Regulation (FAR) subparts 12.6 and 13.5.  Id. at 2. The RFQ anticipates the issuance of a fixed-price contract, for a base year and four 1‑year options.  RFQ at 2-6.  The solicitation states that the award will be made on a lowest-priced, technically-acceptable basis.[2]  Id.  To be considered technically acceptable, the RFQ requires, as relevant here, that a vendor provide a copy of the company’s business license and insurance, as well as a “written description in sufficient detail to allow the Government to ascertain the Offeror[’s] capability to meet the requirements indicated in the [statement of work (SOW)].”  Id. at 7.  The solicitation further states that this description should demonstrate the vendor’s ability to meet . . . the required delivery timeframes, including the ability to respond to a medical emergency requirement, and that vendors should show “demonstrated ability to produce non-HEU (High Enriched Uranium) radioisotopes.”  Id. at 7-8.  In addition, the RFQ provides:  “If the offeror is not a manufacturer of a required item, the offeror must provide evidence they are an authorized distributor or reseller of the proposed items.”  Id. at 7.  The Market Research Supporting the Set-Aside Decision The decision to set-aside this procurement for small businesses resulted from market research conducted in November 2014.  AR, Tab 1, Market Research Report (Nov. 13, 2014), at 1.  Specifically, the stated objective of the market research was “[t]o award a . . . contract to a contractor who can provide the required radioisotopes[3] for the Ralph H. Johnson VA Medical Center.”  Id.  The market research report stated that “[t]he Contractor must have the appropriate permits and licenses[4] to manufacture Radioisotopes and must be able to deliver them in a timely manner.”  Id.  The report also stated:  “Contractor must have insurance and have proven past performance and experience for the production and delivery needs of the [VA Medical Center].”  Id. The market research included “[a] search of vetbiz.gov on November 14th, 2014, for NAICS code 325412 (Pharmaceutical Preparation Manufacturing (size standard 750) . .