NIH awards $11M+ for nonclinical research services, with SRI International as the sole awardee

Contract Overview

Contract Amount: $10,981,532 ($11.0M)

Contractor: SRI International

Awarding Agency: Department of Health and Human Services

Start Date: 2020-08-25

End Date: 2022-08-24

Contract Duration: 729 days

Daily Burn Rate: $15.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: NONCLINICAL MICROBIOLOGICAL, SAFETY, TOXICOLOGY, AND PHARMACOKINETIC SERVICES

Place of Performance

Location: MENLO PARK, SAN MATEO County, CALIFORNIA, 94025

State: California Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $11.0 million to SRI INTERNATIONAL for work described as: NONCLINICAL MICROBIOLOGICAL, SAFETY, TOXICOLOGY, AND PHARMACOKINETIC SERVICES Key points: 1. Contract focuses on critical nonclinical research services, including safety, toxicology, and pharmacokinetics. 2. The award represents a significant investment in the early stages of drug development and research. 3. SRI International, a well-established research organization, is the contractor for this delivery order. 4. The contract duration is 729 days, indicating a substantial project timeline. 5. The primary NAICS code (541714) points to a focus on Biotechnology Research and Development. 6. The contract type is Cost Plus Fixed Fee, which allows for flexibility in research scope but requires careful cost monitoring.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific deliverables and comparable contract data. The Cost Plus Fixed Fee (CPFF) structure can lead to cost overruns if not managed tightly. However, CPFF is common for R&D where the scope may evolve. The total award amount of over $10.9 million for a two-year period suggests a moderate to high cost per day, but the specific value depends heavily on the complexity and uniqueness of the services provided.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple offerors had the opportunity to bid. The specific number of bidders is not provided, but the 'full and open' designation suggests a competitive process was intended. This approach generally aims to ensure fair pricing and access to a broad range of qualified contractors.

Taxpayer Impact: A full and open competition process is generally favorable for taxpayers as it promotes a competitive environment that can drive down costs and improve the quality of services received.

Public Impact

The primary beneficiaries are researchers and institutions within the Department of Health and Human Services, particularly the National Institutes of Health (NIH). The services delivered are crucial for advancing biomedical research, including drug development and safety testing. The geographic impact is primarily within California, where SRI International is located, but the research findings can have national and global implications. This contract supports a specialized workforce in scientific research, toxicology, and pharmacokinetics.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts require diligent oversight to ensure costs remain within reasonable bounds and that the fixed fee is justified.
The lack of specific performance metrics or detailed deliverables in the provided data makes it difficult to assess the true value for money.
Without knowing the number of bidders, it's hard to definitively say if the competition was robust enough to secure the best possible pricing.

Positive Signals

Awarded under full and open competition, suggesting a broad search for qualified contractors.
SRI International is a reputable research organization with a history of government contracting.
The contract supports critical nonclinical research essential for public health initiatives.

Sector Analysis

This contract falls within the Biotechnology Research and Development sector, specifically NAICS code 541714. This sector is characterized by innovation and significant investment in scientific discovery, often involving long research cycles and specialized expertise. Comparable spending in this area by government agencies like NIH is substantial, reflecting the importance of R&D in advancing healthcare and understanding biological processes. The market includes numerous research institutions and specialized contract research organizations.

Small Business Impact

The data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). Therefore, the primary focus was on securing the best technical solution through full and open competition. There is no explicit information on subcontracting plans for small businesses, but large research organizations like SRI International often engage small businesses for specialized services.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officers and program managers within the National Institutes of Health (NIH). As a Cost Plus Fixed Fee contract, rigorous financial oversight is necessary to monitor expenditures against the estimated costs and ensure the fixed fee is earned. Transparency is generally maintained through contract reporting mechanisms, though specific public access to detailed research outcomes may be limited by proprietary or sensitive information.

Related Government Programs

Biotechnology Research and Development
Drug Discovery and Development Services
Toxicology and Safety Testing
Pharmacokinetics and Metabolism Studies
Contract Research Organization Services

Risk Flags

Cost Overrun Risk (CPFF)
Performance Monitoring Difficulty (R&D Scope)
Value for Money Assessment (Lack of Comparables)

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $11.0 million to SRI INTERNATIONAL. NONCLINICAL MICROBIOLOGICAL, SAFETY, TOXICOLOGY, AND PHARMACOKINETIC SERVICES

Who is the contractor on this award?

The obligated recipient is SRI INTERNATIONAL.

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 $11.0 million.

What is the period of performance?

Start: 2020-08-25. End: 2022-08-24.

What is SRI International's track record with similar government contracts, particularly with NIH?

SRI International has a significant history of performing research and development services for various government agencies, including the NIH. Their experience spans a wide range of scientific disciplines, often involving complex, multi-year projects. While specific details of past NIH contracts are not provided here, SRI's established presence in the federal contracting space suggests a familiarity with government requirements, reporting, and compliance. Their ability to secure contracts like this one indicates a perceived capability and reliability in delivering specialized scientific services. Further analysis would involve reviewing their past performance evaluations and the scope of previous related awards to assess consistency and success.

How does the $10.9 million award compare to typical spending for nonclinical research services at NIH?

The $10.9 million award for nonclinical microbiological, safety, toxicology, and pharmacokinetic services over a 729-day period (approximately two years) represents a substantial investment. To benchmark this effectively, one would need to compare it against the average cost of similar service contracts awarded by NIH or other agencies within HHS. Factors such as the specific scientific complexity, the required expertise, and the duration of the contract heavily influence cost. Without access to a broader dataset of comparable contracts, it's difficult to definitively state if this award is high, low, or average. However, given the specialized nature of toxicology and pharmacokinetics, costs can be significant due to the resources and expertise required.

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

The primary risk with a CPFF contract, especially in R&D, is cost escalation. While the contractor's profit (the fixed fee) is fixed, the government bears the risk of cost overruns if the actual costs exceed the estimated costs. This can occur due to unforeseen technical challenges, scope creep, or inefficient performance. For the government, effective oversight is crucial to monitor expenditures, ensure efficient resource utilization, and validate that the work performed aligns with the contract's objectives. If not managed properly, CPFF contracts can become more expensive than initially anticipated, potentially impacting the overall value for money.

How does the NAICS code 541714 (Biotechnology R&D) typically perform in terms of contract value and competition?

NAICS code 541714, covering Biotechnology R&D (except Nanobiotechnology), is a dynamic sector characterized by significant government investment, particularly from agencies like NIH. Contracts within this code often involve substantial values due to the complexity and long-term nature of research. Competition can vary; while 'full and open' is common for larger awards, specialized niches might see fewer bidders. The value of individual contracts can range widely, from smaller grants to multi-million dollar research and development agreements, reflecting the diverse needs of agencies funding cutting-edge scientific exploration. This specific award of over $10.9 million aligns with the higher end for R&D services within this sector.

What is the significance of the contract being a 'Delivery Order' (aw: DELIVERY ORDER)?

A 'Delivery Order' typically indicates that this contract is part of a larger, pre-existing Indefinite Delivery/Indefinite Quantity (IDIQ) contract or a similar type of multiple-award contract. This means that the foundational contract terms, including pricing structures and competition rules, were established previously. The issuance of a delivery order signifies a specific task or requirement being ordered under that umbrella agreement. For this particular award, it suggests that NIH had previously established a contract vehicle (potentially with SRI International or a pool of contractors) and is now exercising an option or placing an order for specific services. This approach allows for flexibility and faster procurement of services as needs arise.

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: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 333 RAVENSWOOD AVE, MENLO PARK, CA, 94025

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

Financial Breakdown

Contract Ceiling: $10,981,532

Exercised Options: $10,981,532

Current Obligation: $10,981,532

Actual Outlays: $6,340,235

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $422,500

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 75N93018D00001

IDV Type: IDC

Timeline