HHS awards $21.4M for influenza vaccine R&D, with a 5-year development timeline

Contract Overview

Contract Amount: $21,404,610 ($21.4M)

Contractor: Seqirus Inc

Awarding Agency: Department of Health and Human Services

Start Date: 2021-09-21

End Date: 2027-01-31

Contract Duration: 1,958 days

Daily Burn Rate: $10.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: R&D

Official Description: THE PURPOSE OF THIS TASK ORDER IS TO PROCURE A INFLUENZA A(H2NX) VIRUS VACCINE CANDIDATE(S) AND CONDUCT CLINICAL TRIAL

Place of Performance

Location: HOLLY SPRINGS, HARNETT County, NORTH CAROLINA, 27540

State: North Carolina Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $21.4 million to SEQIRUS INC for work described as: THE PURPOSE OF THIS TASK ORDER IS TO PROCURE A INFLUENZA A(H2NX) VIRUS VACCINE CANDIDATE(S) AND CONDUCT CLINICAL TRIAL Key points: 1. Value for money appears reasonable given the critical nature of pandemic preparedness and the extended research timeline. 2. The contract was awarded under full and open competition, suggesting a competitive bidding process. 3. Potential risks include the inherent uncertainties in vaccine development and the long duration of the contract. 4. Performance context is within the broader scope of biodefense and public health emergency preparedness. 5. This contract positions the government to advance critical vaccine technology in the biotechnology sector.

Value Assessment

Rating: good

The contract value of $21.4 million over approximately five years for vaccine candidate development and clinical trials appears to be a fair investment for pandemic preparedness. Benchmarking against similar R&D contracts for novel vaccine development is challenging due to the unique nature of specific pathogen targets. However, the firm-fixed-price structure suggests that the government has negotiated a defined cost for the scope of work, providing some cost certainty.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors were likely solicited and allowed to bid. This approach generally fosters a competitive environment, encouraging bidders to offer their best pricing and technical solutions. The presence of two bidders suggests a moderate level of competition for this specialized research and development effort.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it typically leads to more competitive pricing and a wider range of innovative solutions, maximizing the value of federal investment.

Public Impact

The primary beneficiaries are the public, through the development of a potential vaccine against Influenza A(H2NX). Services delivered include the procurement of vaccine candidates and the execution of clinical trials. The geographic impact is national, focusing on public health security. Workforce implications include support for scientific research and clinical trial personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (nearly 5 years) increases the risk of cost overruns or scope creep if not managed diligently.
Vaccine development is inherently uncertain; success is not guaranteed, potentially leading to sunk costs if candidates fail.
Reliance on a single contractor (Seqirus Inc.) for this critical task order warrants close monitoring of performance and progress.

Positive Signals

Awarded under full and open competition, suggesting a robust selection process.
Firm-fixed-price contract provides cost certainty for the government.
Focus on a specific, potentially high-impact influenza strain addresses a critical public health need.

Sector Analysis

This contract falls within the Biotechnology (except Nanobiotechnology) Research and Development sector, a critical area for public health and national security. The market for vaccine development is highly specialized, involving a limited number of companies with the expertise and infrastructure to conduct such research. Government funding plays a significant role in advancing novel vaccine technologies that may not be commercially viable in the short term.

Small Business Impact

The data indicates this contract was not set aside for small businesses, and there is no explicit mention of subcontracting requirements for small businesses. Therefore, the direct impact on the small business ecosystem is likely minimal, although larger prime contractors may engage small businesses for specialized services.

Oversight & Accountability

Oversight will likely be managed by the Office of Assistant Secretary for Preparedness and Response (ASPR) within HHS. Accountability measures will be tied to milestones within the firm-fixed-price contract, focusing on the delivery of vaccine candidates and successful completion of clinical trial phases. Transparency is expected through regular reporting requirements stipulated in the task order.

Related Government Programs

Biodefense Advanced Research Projects Agency (BARDA) programs
National Institute of Allergy and Infectious Diseases (NIAID) research grants
Centers for Disease Control and Prevention (CDC) influenza surveillance

Risk Flags

Long-term contract duration requires sustained oversight.
Vaccine development is high-risk; candidate failure is possible.
Potential for evolving scientific landscape impacting research direction.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $21.4 million to SEQIRUS INC. THE PURPOSE OF THIS TASK ORDER IS TO PROCURE A INFLUENZA A(H2NX) VIRUS VACCINE CANDIDATE(S) AND CONDUCT CLINICAL TRIAL

Who is the contractor on this award?

The obligated recipient is SEQIRUS INC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Office of Assistant Secretary for Preparedness and Response).

What is the total obligated amount?

The obligated amount is $21.4 million.

What is the period of performance?

Start: 2021-09-21. End: 2027-01-31.

What is the track record of Seqirus Inc. in developing and manufacturing influenza vaccines?

Seqirus Inc., a subsidiary of CSL Limited, has a significant track record in influenza vaccine development and manufacturing. They are known for producing both traditional egg-based and cell-based influenza vaccines, as well as novel vaccine technologies. Seqirus has been involved in supplying vaccines to governments for pandemic preparedness stockpiles and has experience with clinical trials. Their expertise in virology, immunology, and large-scale vaccine production positions them as a capable contractor for this task order. However, specific performance details on past government contracts, particularly related to novel candidate development and the specific H2NX strain, would require further investigation into contract databases and performance reports.

How does the $21.4 million cost compare to similar government-funded vaccine R&D efforts?

Benchmarking the $21.4 million cost for this specific Influenza A(H2NX) vaccine candidate development and clinical trial against similar government-funded R&D efforts is complex due to variations in pathogen targets, research phases, and contract structures. However, R&D contracts for novel vaccine development, especially those involving early-stage research and subsequent clinical trials, can range from tens to hundreds of millions of dollars over several years. Given the nearly five-year duration and the inclusion of clinical trials, this value appears within a reasonable range for a specialized biodefense initiative. The firm-fixed-price nature also suggests a degree of cost control negotiated upfront.

What are the primary risks associated with this contract, beyond standard R&D uncertainties?

Beyond the inherent scientific risks of vaccine development (e.g., efficacy, safety, immunogenicity), this contract carries risks related to its long duration (nearly five years), which increases the potential for scope creep, evolving scientific understanding, or changes in public health priorities. The specific target, Influenza A(H2NX), may present unique virological challenges. Furthermore, while awarded competitively, the long-term reliance on a single contractor for a critical preparedness asset necessitates robust government oversight to ensure progress, quality, and adherence to timelines. Economic factors or supply chain disruptions could also impact the contractor's ability to deliver.

How effective is the government's strategy in using R&D contracts for pandemic preparedness?

The government's strategy of using R&D contracts for pandemic preparedness, like this one, is crucial for developing countermeasures against emerging infectious diseases. By investing in early-stage research and development, the government aims to accelerate the availability of vaccines and therapeutics when a threat materializes. This proactive approach allows for the exploration of novel technologies and the stockpiling of promising candidates. The effectiveness hinges on selecting the right targets, fostering genuine competition, ensuring rigorous oversight, and having mechanisms to rapidly scale up production once a threat is confirmed. Contracts like this are a vital component of a multi-layered preparedness strategy.

What are the historical spending patterns for influenza vaccine R&D by HHS?

HHS, primarily through agencies like the National Institutes of Health (NIH) and the Biomedical Advanced Research and Development Authority (BARDA), has a history of significant investment in influenza research and vaccine development. Spending patterns fluctuate based on perceived threats, scientific advancements, and specific program goals. Historically, funding has supported basic research into influenza virology, immunology, and epidemiology, as well as advanced development contracts for novel vaccine platforms (e.g., mRNA, universal vaccines) and pandemic preparedness initiatives. The total annual spending can vary widely, often in the hundreds of millions of dollars, depending on the urgency and scope of ongoing research and development efforts.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in Biotechnology (except Nanobiotechnology)

Product/Service Code: RESEARCH AND DEVELOPMENT › N – Health R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 475 GREEN OAKS PKWY, HOLLY SPRINGS, NC, 27540

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $21,404,610

Exercised Options: $21,404,610

Current Obligation: $21,404,610

Actual Outlays: $21,404,610

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 75A50118D00004

IDV Type: IDC

Timeline