NIH awards $16.3M contract for R&D services, highlighting long-term commitment to scientific advancement

Contract Overview

Contract Amount: $16,331,429 ($16.3M)

Contractor: Priority ONE Services, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2003-09-15

End Date: 2014-06-26

Contract Duration: 3,937 days

Daily Burn Rate: $4.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Place of Performance

Location: BALTIMORE, BALTIMORE (CITY) County, MARYLAND, 21224

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $16.3 million to PRIORITY ONE SERVICES, INC. for work described as: Key points: 1. Contract value suggests significant investment in specialized research capabilities. 2. Long contract duration indicates a sustained need for the services provided. 3. Full and open competition likely fostered competitive pricing and a broad vendor pool. 4. The contract's focus on R&D aligns with NIH's mission to advance health knowledge. 5. Performance period spans over a decade, suggesting stable program execution. 6. The specific NAICS code points to a highly specialized scientific domain.

Value Assessment

Rating: good

The total award of $16.3 million over nearly four years represents a substantial investment. Benchmarking this against similar R&D contracts within the life sciences sector is challenging without more granular data on the specific research scope. However, the duration and consistent funding suggest a fair valuation for the specialized services rendered by Priority One Services, Inc. The Cost Plus Fixed Fee (CPFF) structure, while common in R&D, requires careful monitoring to ensure cost efficiencies.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of two bidders suggests a moderately competitive environment for this specialized R&D service. While two bidders are better than one, a higher number of bids could have potentially driven prices lower or led to more innovative solutions.

Taxpayer Impact: Taxpayers benefit from the assurance that the contract was awarded through a process designed to identify the best value among multiple qualified offerors, rather than being restricted to a single provider.

Public Impact

The National Institutes of Health (NIH) benefits through the acquisition of critical research and development services. The contract supports advancements in physical, engineering, and life sciences research. Geographic impact is primarily centered around the contractor's location in Maryland. Workforce implications include employment opportunities for scientists, researchers, and support staff within the contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can sometimes lead to cost overruns if not managed diligently.
The long duration of the contract might reduce flexibility to adapt to rapidly changing research priorities.
Limited competition (two bidders) may not have fully explored the market's potential for cost savings or innovation.

Positive Signals

Full and open competition ensures a broad search for qualified contractors.
The substantial award amount indicates a high level of confidence in the contractor's capabilities.
The extended performance period suggests a successful and stable working relationship.

Sector Analysis

The contract falls within the Research and Development (R&D) sector, specifically NAICS code 541710, which covers R&D in the Physical, Engineering, and Life Sciences. This sector is characterized by innovation, specialized expertise, and often long-term projects. NIH is a major federal agency that heavily invests in this area, making it a significant player. Comparable spending benchmarks would depend on the specific sub-discipline of research, but federal R&D spending is a multi-billion dollar enterprise annually.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications or specific impacts on the small business ecosystem stemming from a set-aside provision. The primary focus was likely on securing the most capable large or specialized firm for the R&D requirements.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officers and program managers within the National Institutes of Health (NIH). Accountability measures are embedded within the Cost Plus Fixed Fee (CPFF) structure, requiring detailed reporting and justification of costs. Transparency is generally maintained through contract databases, though specific project details might be proprietary. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

National Institutes of Health Research Grants
Biomedical Research and Development
Federal Scientific Research Contracts
Department of Health and Human Services Contracts

Risk Flags

Limited competition (two bidders)
Cost Plus Fixed Fee contract structure requires diligent oversight

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $16.3 million to PRIORITY ONE SERVICES, INC.. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is PRIORITY ONE SERVICES, INC..

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (National Institutes of Health).

What is the total obligated amount?

The obligated amount is $16.3 million.

What is the period of performance?

Start: 2003-09-15. End: 2014-06-26.

What is the specific nature of the research and development services provided under this contract?

The contract, awarded under NAICS code 541710 (Research and Development in the Physical, Engineering, and Life Sciences), suggests the services involve highly specialized scientific inquiry. While the provided data does not detail the exact research projects, it is reasonable to infer that Priority One Services, Inc. is engaged in activities aimed at advancing knowledge in areas relevant to public health, medicine, or biological sciences. This could encompass laboratory research, data analysis, experimental design, or the development of new technologies and methodologies. The long duration and substantial funding indicate a significant and ongoing contribution to NIH's research objectives.

How does the $16.3 million award compare to typical R&D contract values within the NIH?

The $16.3 million award over approximately 3.6 years (3937 days) represents a significant investment. NIH's total budget is in the tens of billions, with a substantial portion allocated to extramural and intramural research contracts. Contracts of this magnitude are not uncommon for complex, multi-year R&D projects requiring specialized expertise. However, without knowing the specific scientific domain and the scope of work, a precise comparison is difficult. Generally, R&D contracts can range from hundreds of thousands to tens or even hundreds of millions of dollars, depending on the scale, duration, and criticality of the research.

What are the potential risks associated with a Cost Plus Fixed Fee (CPFF) contract structure for R&D?

The primary risk with a CPFF contract is that the contractor may have less incentive to control costs compared to fixed-price contracts, as the government agrees to pay all allowable costs plus a fixed fee. This can lead to cost overruns if the contractor's actual costs exceed initial estimates. For the government, effective oversight and robust cost accounting are crucial to ensure that costs are reasonable and allocable. In R&D, where outcomes can be uncertain, CPFF is often used to allow flexibility while ensuring the contractor is fairly compensated for their efforts and expertise.

Given the contract's duration (2003-2014), what does this suggest about the stability and success of the program?

The contract's extensive duration, spanning over a decade from its start date (September 15, 2003) to its end date (June 26, 2014), strongly suggests a high degree of program stability and contractor success. Such long-term engagements typically indicate that the contractor consistently met or exceeded performance expectations, and that the services provided were critical and aligned with the agency's evolving needs. Agencies are unlikely to extend contracts for such extended periods unless the work is essential and the contractor is performing satisfactorily. This longevity also implies a deep understanding of the research objectives and a strong working relationship between NIH and Priority One Services, Inc.

How does the 'full and open competition' with only two bidders impact value for taxpayers?

While 'full and open competition' is the preferred method for ensuring broad market access, having only two bidders presents a mixed picture for taxpayer value. On one hand, it signifies that the process was not unduly restricted, allowing multiple firms to compete. On the other hand, a limited number of bidders (two) may indicate a highly specialized niche market where few companies possess the required capabilities, or it could suggest that the solicitation's terms or perceived difficulty deterred broader participation. This reduced competition might limit the downward pressure on pricing that could occur with a larger pool of bidders, potentially resulting in a less optimal price outcome for taxpayers compared to a more robustly contested contract.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Address: 6600 FLEET DR, ALEXANDRIA, VA, 08

Business Categories: Category Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $23,400,062

Exercised Options: $27,131,836

Current Obligation: $16,331,429

Timeline