HHS awards $98.7M contract for doxycycline, with Chartwell RX LLC as the primary supplier

Contract Overview

Contract Amount: $98,684,252 ($98.7M)

Contractor: Chartwell RX LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2025-06-23

End Date: 2027-01-04

Contract Duration: 560 days

Daily Burn Rate: $176.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: DOXYCYCLINE HYCLATE 100 MG ORAL TABLETS

Place of Performance

Location: CONGERS, ROCKLAND County, NEW YORK, 10920

State: New York Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $98.7 million to CHARTWELL RX LLC for work described as: DOXYCYCLINE HYCLATE 100 MG ORAL TABLETS Key points: 1. Contract value of $98.7M over its period of performance. 2. Full and open competition was utilized for this award. 3. The contract is for pharmaceutical preparation manufacturing. 4. The period of performance spans from June 2025 to January 2027. 5. The contract was awarded as a delivery order. 6. The primary contractor is Chartwell RX LLC. 7. The contract is firm-fixed-price, indicating predictable costs. 8. The contract is managed by the Office of Assistant Secretary for Preparedness and Response (ASPR).

Value Assessment

Rating: good

The contract value of $98.7M for doxycycline over approximately 1.5 years appears reasonable given the nature of pharmaceutical supply contracts. Benchmarking against similar large-scale pharmaceutical procurements would provide a more precise value-for-money assessment. The firm-fixed-price structure suggests that pricing was determined upfront and is not expected to fluctuate significantly, which is beneficial for cost predictability. However, without specific unit cost data or comparisons to market rates for this particular drug formulation and quantity, a definitive value assessment is challenging.

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 offers. The fact that it was competed suggests a healthy market for this pharmaceutical product. The number of bidders is not specified, but the use of full and open competition generally promotes price discovery and encourages competitive pricing among potential suppliers.

Taxpayer Impact: Taxpayers benefit from full and open competition as it typically leads to more competitive pricing and a wider selection of qualified vendors, potentially reducing overall costs for the government.

Public Impact

The Department of Health and Human Services (HHS) benefits by securing a supply of doxycycline. This contract ensures the availability of doxycycline, a critical antibiotic used to treat various bacterial infections. The geographic impact is national, ensuring supply across the United States. The workforce implications are primarily within the pharmaceutical manufacturing and distribution sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for supply chain disruptions if the primary contractor faces production or distribution issues.
Reliance on a single contractor for a significant quantity of a critical medication could pose a risk.
Market fluctuations in raw material costs could impact long-term availability or future pricing if not adequately managed.

Positive Signals

Awarded under full and open competition, suggesting a competitive bidding process.
Firm-fixed-price contract provides cost certainty for the government.
The contract is for a critical pharmaceutical, indicating its importance to public health preparedness.
The contractor, Chartwell RX LLC, is established in pharmaceutical preparation manufacturing.

Sector Analysis

The pharmaceutical manufacturing sector is highly regulated and characterized by significant R&D investment, complex supply chains, and stringent quality control. This contract falls within the broader category of pharmaceutical preparation manufacturing, a vital segment that ensures the availability of essential medicines. The market for antibiotics like doxycycline is substantial, driven by ongoing public health needs and preparedness initiatives. Government contracts play a crucial role in ensuring supply security for critical medications.

Small Business Impact

The data indicates this contract was awarded under full and open competition and does not specify any small business set-aside provisions. Therefore, the direct impact on small businesses as prime contractors is likely minimal for this specific award. However, the prime contractor, Chartwell RX LLC, may engage small businesses for subcontracting opportunities related to logistics, distribution, or specialized manufacturing processes, though this is not explicitly detailed in the provided information.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Health and Human Services (HHS), specifically the Office of Assistant Secretary for Preparedness and Response (ASPR). ASPR is responsible for ensuring the contractor meets all performance requirements, quality standards, and delivery schedules. Accountability measures are embedded within the contract terms, including performance metrics and potential penalties for non-compliance. Transparency is generally maintained through contract databases and public reporting, though specific operational details may be sensitive.

Related Government Programs

Strategic National Stockpile
Antimicrobial Resistance Initiatives
Public Health Emergency Preparedness Contracts
Pharmaceutical Supply Chain Management

Risk Flags

Potential for supply chain disruption
Reliance on a single supplier for critical medication
Lack of specific unit cost data for benchmarking
Limited information on contractor's past performance

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $98.7 million to CHARTWELL RX LLC. DOXYCYCLINE HYCLATE 100 MG ORAL TABLETS

Who is the contractor on this award?

The obligated recipient is CHARTWELL RX LLC.

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 $98.7 million.

What is the period of performance?

Start: 2025-06-23. End: 2027-01-04.

What is the historical spending by HHS on doxycycline or similar antibiotics?

Historical spending data for doxycycline or similar antibiotics by HHS is not directly available in the provided contract details. However, government agencies, particularly those focused on public health and emergency preparedness like ASPR, often procure essential medicines through various contract vehicles. This can include direct purchases, long-term supply agreements, and additions to the Strategic National Stockpile. Analyzing past contract awards for antibiotics within HHS and other relevant agencies (e.g., Department of Defense, VA) would provide context on typical spending levels, contract durations, and pricing trends. Such an analysis would reveal if this $98.7M award represents a significant increase or decrease in federal investment for this specific drug category.

How does the unit price of doxycycline under this contract compare to market rates or previous government contracts?

The provided data does not include the specific unit price for doxycycline under this contract, making a direct comparison to market rates or previous government contracts impossible. To assess value for money, one would need to know the quantity of tablets being procured (e.g., total number of tablets) and the total contract value to derive an average unit cost. This derived unit cost could then be benchmarked against publicly available pharmaceutical pricing databases, wholesale acquisition costs, or historical government contract awards for the same or similar formulations of doxycycline. Without this unit cost data, it's difficult to determine if the $98.7M represents a competitive price.

What is Chartwell RX LLC's track record with government contracts, particularly for pharmaceuticals?

Chartwell RX LLC's track record with government contracts, particularly for pharmaceuticals, is a key factor in assessing the reliability of this award. While the provided data confirms Chartwell RX LLC as the contractor, it does not detail their past performance history. A thorough analysis would involve reviewing federal procurement databases (like SAM.gov or FPDS) to identify previous contracts awarded to Chartwell RX LLC, their value, duration, and the agencies involved. Furthermore, examining past performance evaluations or any reported contract disputes or successes would provide insight into their capabilities, reliability, and adherence to quality and delivery standards. A history of successful, on-time deliveries and quality compliance would increase confidence in their ability to fulfill this current $98.7M contract.

What are the specific risks associated with relying on a single supplier for this critical medication?

Relying on a single supplier, even one selected through full and open competition, introduces several risks. Foremost is the potential for supply chain disruptions. If Chartwell RX LLC experiences manufacturing issues, raw material shortages, quality control failures, or logistical problems, the supply of doxycycline could be interrupted. This is particularly concerning for a critical medication that may be needed for public health emergencies or routine treatment. Another risk is reduced leverage for the government in future negotiations; a sole supplier may have more power to dictate terms or pricing in subsequent contract renewals. Diversification of suppliers, where feasible, can mitigate these risks by providing alternative sources and fostering ongoing competition.

How does this contract align with HHS's mission for public health preparedness and response?

This contract directly aligns with HHS's mission for public health preparedness and response by ensuring the availability of doxycycline, an essential antibiotic. Doxycycline is a broad-spectrum antibiotic used to treat a wide range of bacterial infections, including those that could be relevant during public health emergencies (e.g., anthrax, plague, certain sexually transmitted infections). By securing a supply through a firm-fixed-price contract with a defined period of performance, HHS, through ASPR, is proactively managing its pharmaceutical inventory to meet potential demands, whether for routine use, stockpiling, or rapid deployment during crises. This procurement demonstrates a commitment to maintaining a robust supply chain for critical medical countermeasures.

What is the expected duration and quantity of doxycycline to be supplied under this contract?

The contract has a period of performance from June 23, 2025, to January 4, 2027, which is approximately 1.5 years. The total quantity of doxycycline tablets to be supplied is not explicitly stated in the provided data. The contract value is $98,684,252.16. To determine the quantity, one would need to know the average unit price or the total number of units anticipated. Without this information, it's impossible to ascertain the exact volume of medication being procured, which is crucial for understanding the scale of the supply effort and for performing detailed cost-effectiveness analyses.

Industry Classification

NAICS: Manufacturing › Pharmaceutical and Medicine Manufacturing › Pharmaceutical Preparation Manufacturing

Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP

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: 77 BRENNER DR, CONGERS, NY, 10920

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $167,964,526

Exercised Options: $98,684,252

Current Obligation: $98,684,252

Actual Outlays: $49,837,532

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 36F79720D0198

IDV Type: FSS

Timeline