BARDA awards $117M contract for Phase 2 ARDS trial, focusing on novel host-directed therapeutics
Contract Overview
Contract Amount: $117,399,278 ($117.4M)
Contractor: PPD Development LP
Awarding Agency: Department of Health and Human Services
Start Date: 2023-12-15
End Date: 2030-09-30
Contract Duration: 2,481 days
Daily Burn Rate: $47.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE
Sector: R&D
Official Description: BARDA WILL IMPLEMENT A RANDOMIZED, DOUBLE-BLIND, PLACEBO-CONTROLLED, MULTICENTER PHASE 2 TRIAL IN THE US TO EVALUATE THE SAFETY AND EFFICACY OF NOVEL HOST-DIRECTED THERAPEUTIC CANDIDATES IN HOSPITALIZED ADULTS WITH ARDS.
Place of Performance
Location: WILMINGTON, NEW HANOVER County, NORTH CAROLINA, 28401
Plain-Language Summary
Department of Health and Human Services obligated $117.4 million to PPD DEVELOPMENT LP for work described as: BARDA WILL IMPLEMENT A RANDOMIZED, DOUBLE-BLIND, PLACEBO-CONTROLLED, MULTICENTER PHASE 2 TRIAL IN THE US TO EVALUATE THE SAFETY AND EFFICACY OF NOVEL HOST-DIRECTED THERAPEUTIC CANDIDATES IN HOSPITALIZED ADULTS WITH ARDS. Key points: 1. The contract supports critical research into treatments for Acute Respiratory Distress Syndrome (ARDS), a severe lung condition. 2. This Phase 2 trial aims to evaluate the safety and efficacy of new therapeutic candidates. 3. The award is a definitive contract with a Cost Plus Incentive Fee structure. 4. The research and development falls under the Biotechnology sector, specifically R&D in Biotechnology (except Nanobiotechnology).
Value Assessment
Rating: good
The contract value of $117.4 million for a Phase 2 clinical trial is within a reasonable range for multi-center, complex studies. Benchmarking against similar large-scale clinical trials for ARDS or related respiratory illnesses would provide further context.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a robust price discovery process. This method allows multiple qualified contractors to bid, promoting competitive pricing.
Taxpayer Impact: The investment aims to advance critical medical research, potentially leading to life-saving treatments, which represents a significant long-term benefit to taxpayers.
Public Impact
Potential for new treatments for ARDS, a condition with high mortality and limited therapeutic options. Advancement of biomedical research capabilities within the US. Contribution to national preparedness for public health emergencies. Long-term healthcare cost savings if effective treatments reduce hospitalization duration and severity.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Trial duration is long (over 6 years), increasing cost and risk of obsolescence.
- Phase 2 trials have a significant risk of failure.
- Cost Plus Incentive Fee contracts can lead to cost overruns if not managed tightly.
Positive Signals
- Focus on novel host-directed therapeutics offers a promising new approach.
- Multi-center, double-blind, placebo-controlled design ensures scientific rigor.
- Full and open competition likely secured competitive pricing.
Sector Analysis
This contract falls within the Research and Development in Biotechnology sector. Spending in this area is crucial for innovation but can be high-risk, with long development timelines and uncertain outcomes. Benchmarks for Phase 2 clinical trials vary widely based on therapeutic area and complexity.
Small Business Impact
The data indicates this contract was awarded to PPD Development LP, a large contract research organization. There is no explicit indication of small business participation in this specific award, suggesting opportunities may lie in subcontracting.
Oversight & Accountability
The Department of Health and Human Services, through the Office of the Assistant Secretary for Preparedness and Response (ASPR), is responsible for this contract. Oversight will likely involve monitoring trial progress, adherence to protocols, and financial expenditures to ensure accountability.
Related Government Programs
- Research and Development in Biotechnology (except Nanobiotechnology)
- Department of Health and Human Services Contracting
- Office of Assistant Secretary for Preparedness and Response Programs
Risk Flags
- Long contract duration increases risk of cost escalation and potential for research becoming outdated.
- Phase 2 clinical trials have a high failure rate for efficacy and safety.
- Cost Plus Incentive Fee contracts require diligent oversight to prevent cost overruns.
- Dependence on specific therapeutic candidates carries inherent research risk.
Tags
research-and-development-in-biotechnolog, department-of-health-and-human-services, nc, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $117.4 million to PPD DEVELOPMENT LP. BARDA WILL IMPLEMENT A RANDOMIZED, DOUBLE-BLIND, PLACEBO-CONTROLLED, MULTICENTER PHASE 2 TRIAL IN THE US TO EVALUATE THE SAFETY AND EFFICACY OF NOVEL HOST-DIRECTED THERAPEUTIC CANDIDATES IN HOSPITALIZED ADULTS WITH ARDS.
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 (Office of Assistant Secretary for Preparedness and Response).
What is the total obligated amount?
The obligated amount is $117.4 million.
What is the period of performance?
Start: 2023-12-15. End: 2030-09-30.
What is the projected timeline for achieving key milestones within this Phase 2 trial, and how will progress be measured against the incentive fee structure?
The contract spans from December 15, 2023, to September 30, 2030, indicating a long-term research effort. Key milestones will likely include patient recruitment completion, interim data analysis, and final efficacy/safety reporting. The incentive fee structure will tie a portion of the contractor's profit to achieving specific performance targets, such as meeting enrollment goals or demonstrating preliminary positive results, which requires clear definition and monitoring by BARDA.
Given the inherent risks in Phase 2 drug development, what contingency plans are in place if the novel therapeutics show insufficient efficacy or unexpected safety concerns?
BARDA's investment in a Phase 2 trial acknowledges the inherent risks. Contingency plans would typically involve pre-defined 'go/no-go' decision points based on interim data analysis. If efficacy is insufficient or safety concerns arise, the trial could be halted early, or the protocol amended. BARDA may also have alternative therapeutic candidates or research pathways it can pivot to, leveraging the infrastructure and knowledge gained from this trial.
How does the Cost Plus Incentive Fee (CPIF) structure balance the need for rigorous scientific investigation with cost control for taxpayer funds?
The CPIF structure aims to incentivize the contractor (PPD Development LP) to perform efficiently and effectively. BARDA sets target costs and target profits, with a fee that is adjusted based on actual costs relative to the target. An incentive fee is paid if costs are below target, and reduced if costs exceed target, up to a ceiling. This encourages cost consciousness while allowing for the flexibility needed in complex R&D where precise cost estimation is difficult.
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: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Address: 929 N FRONT ST, WILMINGTON, NC, 28401
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $222,126,308
Exercised Options: $117,399,278
Current Obligation: $117,399,278
Actual Outlays: $15,205,599
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2023-12-15
Current End Date: 2030-09-30
Potential End Date: 2030-09-30 00:00:00
Last Modified: 2025-11-12
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