Philadelphia –
The Defense Logistics Agency Medical supply chain awarded a next generation pharmaceutical prime vendor contract on March 7th. The contract awards a total of $30.3 billion over the next 10 years, including a small business component of $1.3 billion.
The PPV program—now in its fifth iteration—includes over $2.6 billion in cost avoidance passed on to customers by leveraging capabilities of the nation’s largest prime vendors, said Catherine Gilbert, Medical contracting officer.
“The contract provides worldwide support to Defense Health Agency, Department of Defense customers, the United States Coast Guard, designated providers, other government agencies, and the US Naval Fleet,” Gilbert said. “[DLA] uses the prime vendor model, a standard commercial practice, to provide pharmaceuticals to military treatment facilities such as hospitals and pharmacies.”
The supply chain utilizing private sector business models can be a benefit to Medical’s customers.
“Mirroring commercial practices through a firm- fixed price requirements contract will result in increased supply efficiencies and return the lowest price to the customer.” Gilbert said.
“It starts with a contractual agreement between the government and the prime vendors who buy inventory from a variety of sources, stores them in commercial warehouses, and ships directly to the customer.”
The PPV Gen V expands DLA’s capabilities to meet new and emerging pharmaceutical customer needs.
“Pharmaceutical items identified as “specialty” have grown significantly over the last few years,” Gilbert said. “These types of drugs are generally higher in dollar value, require monitoring, and are largely for more targeted therapies such as chemotherapy. The industry has shown that specialty drugs need to be distributed differently, and the pricing model must be adjusted accordingly to align with commercial practices. This generation of the PPV program has evolved alongside the pharmaceutical marketplace.”
The contract includes planned and unplanned direct support to the military, said Andrea Del Collo, Medical lead commodity support liaison.
“In addition to normal day-to-day operations, the program supports readiness, which is the rapid acquisition of pharmaceutical requirements to respond to contingency operations for pre-planned and emergent disaster relief,” said Del Collo.
The DLA Troop Support Small Business Office provides training, advice, guidance and strategies to maximize opportunities for small businesses to participate in DLA's acquisition program, both as prime contractors and subcontractors, said DLA Troop Support Small Business Director Jessica Wallis.
“Integrating small businesses into even our most complex acquisitions is crucial,” said Wallis. “They are a vital component of our industrial base.”