Battelle Memorial Institute awarded $33M R&D contract by NIH, spanning nearly a decade

Contract Overview

Contract Amount: $32,960,723 ($33.0M)

Contractor: Battelle Memorial Institute

Awarding Agency: Department of Health and Human Services

Start Date: 2003-09-15

End Date: 2012-09-30

Contract Duration: 3,303 days

Daily Burn Rate: $10.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Place of Performance

Location: COLUMBUS, FRANKLIN County, OHIO, 43201

State: Ohio Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $33.0 million to BATTELLE MEMORIAL INSTITUTE for work described as: Key points: 1. Contract awarded through full and open competition, suggesting a robust marketplace. 2. Long duration of the contract (over 9 years) may indicate stable, ongoing research needs. 3. Cost-plus-fixed-fee structure allows for flexibility but requires careful oversight of costs. 4. Research and Development in Physical, Engineering, and Life Sciences is a critical sector for innovation. 5. Contract awarded to a single entity, Battelle Memorial Institute, for the entirety of its duration. 6. Geographic location in Ohio may point to specific regional research capabilities or facilities.

Value Assessment

Rating: fair

The total award of $32.96 million over approximately 9 years averages to about $3.66 million per year. Without specific deliverables or performance metrics, it is difficult to benchmark the value for money. The cost-plus-fixed-fee (CPFF) contract type can lead to cost overruns if not managed tightly, potentially impacting value. Comparing this to similar R&D contracts for specialized scientific research would provide a clearer picture of its cost-effectiveness.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that multiple bidders had the opportunity to submit proposals. The fact that it resulted in a single award to Battelle Memorial Institute suggests they were the most qualified or offered the best value among the competitors. The level of competition at the outset is positive for price discovery, though the long-term nature of the award might limit subsequent competitive opportunities.

Taxpayer Impact: Taxpayers benefit from the initial competitive process which should have driven down costs. However, the long duration without re-competition could mean less pressure on the contractor to maintain cost efficiencies over time.

Public Impact

The primary beneficiaries are likely the National Institutes of Health (NIH) and the broader scientific community through advancements in physical, engineering, and life sciences. The contract supports critical research and development activities, potentially leading to new technologies, treatments, or scientific understanding. The geographic impact is centered in Ohio, where Battelle Memorial Institute is located, potentially supporting local high-skilled jobs. Workforce implications include employment for scientists, engineers, technicians, and support staff at Battelle.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration without re-competition could reduce cost-saving incentives.
CPFF contract type requires diligent oversight to prevent cost creep.
Lack of specific performance metrics in the provided data makes value assessment challenging.

Positive Signals

Awarded through full and open competition, indicating a competitive initial selection.
Battelle Memorial Institute is a well-established research organization with a strong track record.
The contract supports critical R&D in vital scientific fields.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences (NAICS code 541710). This sector is crucial for national innovation and competitiveness. Spending in this area is often characterized by long-term projects, high upfront investment, and the potential for significant breakthroughs. Comparable spending benchmarks would involve looking at other large-scale R&D grants and contracts awarded by agencies like NIH, NSF, and DOD to research institutions and private companies.

Small Business Impact

The provided data indicates this contract was not set aside for small businesses (ss: false, sb: false). Battelle Memorial Institute is a large research organization. There is no information on subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem appears minimal, though indirect benefits could arise if Battelle utilizes small business suppliers for materials or services.

Oversight & Accountability

Oversight for this contract would primarily fall under the National Institutes of Health (NIH), a division of the Department of Health and Human Services. As a Cost Plus Fixed Fee contract, rigorous financial oversight is expected to monitor expenditures against the fixed fee and ensure compliance with research objectives. Transparency would be facilitated through regular reporting requirements from the contractor. The Inspector General for HHS would have jurisdiction over potential fraud, waste, or abuse.

Related Government Programs

National Institutes of Health Research Grants
Department of Defense Research and Development Contracts
National Science Foundation Research Awards
Department of Energy Applied Research Programs

Risk Flags

Long contract duration
Cost-plus contract type
Lack of performance metrics visibility

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $33.0 million to BATTELLE MEMORIAL INSTITUTE. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is BATTELLE MEMORIAL INSTITUTE.

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 $33.0 million.

What is the period of performance?

Start: 2003-09-15. End: 2012-09-30.

What is Battelle Memorial Institute's track record with government R&D contracts?

Battelle Memorial Institute has a long and extensive history of performing research and development for various U.S. government agencies, including the Department of Defense, Department of Energy, and Department of Health and Human Services. They are known for their work in areas such as national security, energy, environmental science, and health. Their track record generally indicates a capacity to handle large, complex R&D projects. However, specific performance details, past issues, or successes on similar NIH contracts would require deeper investigation into contract performance reports and agency evaluations.

How does the $33M total award compare to other NIH R&D contracts of similar duration?

A total award of $33 million spread over approximately 9 years equates to an average annual value of roughly $3.66 million. This figure needs to be contextualized within the specific research domain. NIH funds a wide spectrum of research, from basic science grants to large-scale applied research programs. For highly specialized or large-scale applied R&D projects, this annual average might be considered moderate. However, without knowing the specific scientific objectives, complexity, and required resources for this particular contract, a direct comparison is challenging. Benchmarking against contracts with similar NAICS codes (541710) and agency (NIH) would be necessary for a precise assessment.

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

The primary risks with a CPFF contract for R&D revolve around cost control and contractor efficiency. While the fixed fee provides the contractor with an incentive to control costs (as they receive the same fee regardless of the final cost), the government bears the risk of cost overruns. If the R&D effort proves more complex or expensive than initially anticipated, the total cost to the government can escalate significantly. Effective oversight is crucial to ensure that costs are reasonable and allocable, and that the contractor is making diligent efforts to manage expenses within the anticipated budget. Scope creep, if not managed, can also inflate costs under this structure.

How effective is 'full and open competition' in ensuring value for long-term R&D projects?

Full and open competition is generally the most effective method for ensuring value at the outset of a contract. It allows the government to solicit proposals from the widest possible pool of qualified sources, fostering price competition and innovation. For long-term R&D projects, however, the initial competition sets the stage. While it ensures a strong start, the long duration (like this 9-year contract) means that subsequent opportunities for competitive pressure are limited unless contract modifications or follow-on contracts are re-competed. The value realized over the entire period depends heavily on the initial selection, contract structure, and ongoing performance management.

What is the significance of the contract being awarded to a single entity for its entire duration?

Awarding a contract to a single entity for its entire duration, especially a long one like this (over 9 years), signifies a high degree of confidence in that contractor's ability to meet the program's needs consistently. It suggests stability and a potentially deep integration of the contractor's capabilities with the agency's objectives. From a risk perspective, it concentrates the execution risk with one organization. For taxpayers, it means that the benefits of competition are primarily realized at the initial award phase. If the contractor's performance falters or costs escalate unexpectedly over the years, there are fewer immediate competitive levers to pull without potentially disrupting the program.

What are the potential implications of the contract's duration on innovation?

A long contract duration, such as this 9-year award, can have mixed implications for innovation. On one hand, it provides the contractor with the stability and resources needed for long-term, high-risk research where breakthroughs may take years to materialize. This stability can foster deeper expertise and allow for sustained focus. On the other hand, very long contracts without periodic re-competition or performance reviews might reduce the incentive for the contractor to continuously innovate or adopt more efficient methods, as their position is secured. The specific nature of the R&D and the contract's built-in incentives for innovation will determine the ultimate impact.

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: RESEARCH AND DEVELOPMENT › General Science and Technology R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 6

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Address: 505 KING AVENUE, COLUMBUS, OH, 43201

Business Categories: Category Business, Corporate Entity Tax Exempt, Manufacturer of Goods, Nonprofit Organization, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $20,375,746

Exercised Options: $20,375,746

Current Obligation: $32,960,723

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 266030061

IDV Type: IDC

Timeline