BD, Boston Sci Win Major U.S. Military Contracts

The last week of September saw nearly $200 million in U.S. Defense Department contract awards for the medical device industry.

Maureen Kingsley

Last week was a good one for medical device companies seeking U.S. government contracts.

Two medtech giants--Becton Dickinson (BD; via its CareFusion subsidiary) and Boston Scientific--won notably large Defense Department bids collectively totaling $171 million. A third, smaller award of $13.5 million was granted to Spacelabs Medical Inc.

CareFusion, spun off from Cardinal Health in 2009 and acquired for $12.2 billion by BD six years later, landed a $100-million contract to develop an automated drug dispensing system for military pharmacies and healthcare centers, according to a September 30 announcement from the Department of Defense. Under the five-year blanket purchase agreement, CareFusion will develop the Pharmacy Impatient Automation Solution-Automated Dispensing Cabinet for military treatment facility (MTF) inpatient pharmacies, hospitals, and clinics. (MTFs are located at military bases and posts.) The scheduled performance-completion date is September 29, 2021.

CareFusion's contract "supports the need for comprehensive pharmacy inpatient automation ... that meets the highest quality standards for implementation at military treatment facilities across the Military Health System," according to the Defense Department. The award also reflects the department's desire to standardize and rationalize drug-distribution efforts across the system. "The intent of this automated solution," the contract summary reads, "is to enhance the medication distribution capabilities of MTF inpatient pharmacies and hospital/clinic service areas while seeking to gain management efficiencies and cost savings."

San Diego-based CareFusion provides enterprise IT, surveillance, medication management, and analytics tools and services for the healthcare industry.

Boston Scientific's Defense Department win, awarded on September 30, is worth $71 million and has the Marlborough, MA-based corporation providing cardiovascular products to the U.S. Army, Navy, Air Force, Marine Corps and federal civilian agencies. The deal, described by the department as "indefinite-delivery/indefinite-quantity," includes a one-year base contract with four one-year renewal options. September 28, 2021 is the scheduled performance-completion date.

Boston Scientific's successful cardiovascular segment includes its Interventional Cardiology and Peripheral Interventions businesses, which sell such products as stents, catheters, and guidewires. The company reported significant operational revenue growth of 9% in this segment in 2015.

Rounding out the list of last week's medtech-based government-contract winners was Spacelabs Healthcare, a subsidiary of Hawthorne, CA-based OSI Systems Inc., which makes electronic systems for various markets. Spacelabs was awarded roughly $13.5 million for a contract modification "exercising the seventh option year [of nine] of a one-year base contract" for which the company is providing the Defense Department with patient-monitoring systems, subsystems, accessories, consumables, and training. The performance-completion date is scheduled for October 7, 2017.

Spacelabs, founded in 1958, specializes in products for patient monitoring and connectivity, anesthesia delivery, and diagnostic cardiology.

Maureen Kingsley is a contributor to Qmed. 

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[Image from U.S. Army Medical Research and Material Command's history.]