NIH awarded $97M for R&D facilities, with PPD Development LP securing the contract

Contract Overview

Contract Amount: $96,961,690 ($97.0M)

Contractor: PPD Development LP

Awarding Agency: Department of Health and Human Services

Start Date: 2003-09-30

End Date: 2012-11-07

Contract Duration: 3,326 days

Daily Burn Rate: $29.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: RESEARCH AND DEVELOPMENT FACILITIES

Place of Performance

Location: WILMINGTON, NEW HANOVER County, NORTH CAROLINA, 28412

State: North Carolina Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $97.0 million to PPD DEVELOPMENT LP for work described as: RESEARCH AND DEVELOPMENT FACILITIES Key points: 1. Contract value of $97M over 9 years suggests significant investment in research infrastructure. 2. Full and open competition indicates a potentially robust market for these services. 3. The contract's duration and cost-plus-fixed-fee structure warrant scrutiny for cost control. 4. Performance context is limited without specific deliverables or outcome metrics. 5. Positioned within the R&D sector, this contract supports critical scientific advancement. 6. The award to PPD Development LP highlights a key player in federal research facilities.

Value Assessment

Rating: fair

The total award of $97M over approximately 9 years averages to over $10M annually, which is substantial for R&D facilities. Benchmarking this against similar contracts for specialized research infrastructure is difficult without more specific details on the scope of work. The cost-plus-fixed-fee (CPFF) structure can lead to cost overruns if not managed tightly, but it also allows for flexibility in research projects where exact costs are unpredictable. The fixed fee component provides some predictability for the contractor's profit.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting that multiple vendors had the opportunity to bid. With 6 bidders identified, this indicates a competitive environment for securing this R&D facilities contract. A higher number of bidders generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: The full and open competition likely resulted in a more competitive pricing structure, benefiting taxpayers by ensuring the government received value for its investment in research facilities.

Public Impact

Benefits researchers and scientists by providing necessary facilities for physical, engineering, and life sciences R&D. Supports advancements in various scientific fields through the provision of specialized infrastructure. Geographic impact is likely concentrated in North Carolina, where the contractor is based, but the research outcomes can have national and global implications. Workforce implications include employment opportunities for construction, maintenance, and specialized technical staff at the facility.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts require diligent oversight to prevent scope creep and ensure cost efficiency.
Long contract duration necessitates ongoing performance monitoring to ensure continued value.
Lack of specific performance metrics makes it challenging to assess the true effectiveness of the facilities.

Positive Signals

Full and open competition suggests a healthy market and potential for competitive pricing.
Awarding to a single contractor for a long duration can foster expertise and efficiency in facility management.
The significant investment indicates a commitment to advancing critical research areas.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on physical, engineering, and life sciences. The R&D sector is a significant area of federal spending, aimed at fostering innovation and scientific discovery. Comparable spending benchmarks would involve looking at other large-scale facility development or management contracts within federal agencies like NIH, NSF, or DoD, which often involve substantial investments in specialized infrastructure.

Small Business Impact

Information regarding small business set-asides or subcontracting plans is not explicitly provided in the data. Given the nature and scale of R&D facility contracts, it is possible that larger firms are primary awardees, with potential for subcontracting opportunities for specialized services. Further analysis would be needed to determine the extent of small business participation.

Oversight & Accountability

Oversight for this contract would typically be managed by the National Institutes of Health (NIH) contracting officers and program managers. Accountability measures would be tied to the terms of the Cost Plus Fixed Fee contract, including adherence to the fixed fee, management of direct costs, and delivery of services as outlined in the contract. Transparency is generally maintained through contract databases, though specific operational details may be proprietary.

Related Government Programs

National Institutes of Health Research Facilities
Federal R&D Infrastructure Investments
Biomedical Research Support Contracts
Physical Science Research Facilities
Engineering Research Infrastructure

Risk Flags

Cost-plus-fixed-fee contract type requires diligent cost oversight.
Long contract duration necessitates ongoing performance monitoring.
Potential for cost overruns inherent in CPFF structures.
Scope definition and management are critical for success.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $97.0 million to PPD DEVELOPMENT LP. RESEARCH AND DEVELOPMENT FACILITIES

Who is the contractor on this award?

The obligated recipient is PPD DEVELOPMENT LP.

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 $97.0 million.

What is the period of performance?

Start: 2003-09-30. End: 2012-11-07.

What specific types of R&D facilities were developed or managed under this contract?

The provided data indicates the contract was for 'Research and Development Facilities' under NAICS code 541710 (Research and Development in the Physical, Engineering, and Life Sciences). However, the specific types of facilities (e.g., laboratories, testing centers, specialized equipment hubs) are not detailed. Given the broad scope of NIH's mission, these facilities could range from wet labs for biological research to clean rooms for semiconductor development or specialized testing grounds for engineering projects. The contract's duration and value suggest a significant, potentially long-term infrastructure project or a portfolio of facility services.

How does the $97M award compare to typical federal spending on R&D facilities over a similar timeframe?

An award of $97M over approximately 9 years (from 2003 to 2012) averages to roughly $10.7M per year. This figure is substantial but needs to be contextualized within the broader federal R&D budget, which can run into the tens of billions annually. NIH alone has a budget in the tens of billions. For specific R&D facility construction or major renovation projects, $10M-$20M annually per project is not uncommon, especially for specialized or large-scale infrastructure. However, this contract could also encompass ongoing operations and maintenance for multiple facilities, making direct comparison to single construction projects challenging.

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

The primary risk with CPFF contracts is the potential for cost overruns. While the contractor's profit is fixed, the government bears the risk of increased direct costs. If the scope of work expands or unforeseen challenges arise during R&D or facility development/management, the total cost to the government can escalate significantly beyond initial estimates. Effective oversight, clear scope definition, and robust change control processes are crucial to mitigate these risks. Another risk is the contractor's incentive to control costs, as their profit margin is fixed regardless of how efficiently they manage expenses.

What was the track record of PPD Development LP with federal contracts prior to or during this award?

The provided data does not include information on PPD Development LP's prior federal contracting history. To assess their track record, one would need to examine databases like FPDS-NG or SAM.gov for previous awards, performance reviews (e.g., Contractor Performance Assessment Reporting System - CPARS), and any history of contract disputes or terminations. A thorough review would reveal their experience with similar contract types (CPFF), agencies, and service areas, providing insight into their reliability and performance.

How has federal spending on R&D facilities evolved since this contract was awarded?

Federal spending on R&D facilities has generally remained robust, driven by the need for cutting-edge research infrastructure across various agencies like NIH, NSF, DoD, and DOE. Since the period of this contract (2003-2012), there has been a continued emphasis on modernizing laboratories, investing in advanced computing infrastructure, and supporting specialized research centers. While specific figures fluctuate annually based on appropriations and national priorities, the overall trend indicates sustained investment in R&D facilities to maintain scientific competitiveness and address national challenges.

What does the 'NC' status signify in the contract details?

The 'NC' status in the contract details likely stands for 'Not Applicable' or 'Not Classified' in relation to specific contract attributes not captured by standard fields, or it could indicate a specific administrative code. Without further context or a data dictionary for this specific dataset, its precise meaning is uncertain. It does not appear to relate to the contract type, competition, or performance status directly, as those are indicated by other fields.

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: ARCHITECT/ENGINEER SERVICES › ARCH-ENG SVCS - CONSTRUCTION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 6

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Jaguar Holding Company II (UEI: 078391342)

Address: 3151 S 17TH ST, WILMINGTON, NC, 07

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $99,330,463

Exercised Options: $96,961,690

Current Obligation: $96,961,690

Contract Characteristics

Multi-Year Contract: Yes

Timeline