HHS awards $11.1M for Oracle cloud services to Emergent, LLC, under full and open competition

Contract Overview

Contract Amount: $11,109,982 ($11.1M)

Contractor: Emergent, LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2024-04-10

End Date: 2027-04-09

Contract Duration: 1,094 days

Daily Burn Rate: $10.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: ORACLE CLOUD SERVICES FOR THE HHS-ASFR-OF

Place of Performance

Location: VIRGINIA BEACH, VIRGINIA BEACH CITY County, VIRGINIA, 23462

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $11.1 million to EMERGENT, LLC for work described as: ORACLE CLOUD SERVICES FOR THE HHS-ASFR-OF Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract is for Oracle cloud services, a critical component for data management and IT infrastructure. 3. The duration of the contract is approximately three years, indicating a medium-term need. 4. The award to Emergent, LLC, requires scrutiny of their past performance and capacity for such services. 5. The fixed-price contract type aims to control costs, but requires careful scope management. 6. The National Institutes of Health (NIH) is the specific agency within HHS utilizing these services.

Value Assessment

Rating: fair

Benchmarking the value of this $11.1 million Oracle cloud services contract is challenging without specific service level agreements and detailed usage metrics. However, the fixed-price nature suggests an attempt to control costs. Comparing this to similar cloud service contracts within HHS or other agencies for comparable Oracle solutions would provide better insight into whether the pricing is competitive. The absence of detailed performance metrics in the provided data makes a definitive value assessment difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit bids. The presence of two bids suggests a moderate level of competition for this requirement. A higher number of bidders typically leads to more competitive pricing and a wider range of technical solutions, but two bids still provide a basis for price discovery and selection.

Taxpayer Impact: A competitive bidding process helps ensure that taxpayer dollars are used efficiently by driving down prices and encouraging innovative solutions. Full and open competition is generally the most beneficial approach for taxpayers.

Public Impact

The primary beneficiaries are likely researchers and administrative staff within the National Institutes of Health (NIH) who rely on robust cloud infrastructure for data storage, processing, and application hosting. The services delivered are essential for maintaining and enhancing the IT infrastructure supporting critical health research and public health initiatives. The geographic impact is primarily within the operational centers of the NIH, likely concentrated in Maryland and potentially other research facilities. Workforce implications may include IT support staff managing the Oracle cloud environment and researchers utilizing the enhanced capabilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in with Oracle cloud services, limiting future flexibility and potentially increasing long-term costs.
Dependence on a single contractor for critical cloud infrastructure introduces performance and availability risks.
Scope creep could lead to cost overruns if not managed tightly under the fixed-price contract.
Ensuring adequate data security and compliance with health regulations within the cloud environment is paramount.

Positive Signals

Awarded through full and open competition, indicating a fair and transparent procurement process.
Fixed-price contract type helps to establish cost certainty for the government.
The contract duration of three years allows for stable service provision for critical NIH operations.
The use of cloud services can offer scalability and flexibility for NIH's evolving IT needs.

Sector Analysis

The IT services sector, particularly cloud computing, is a rapidly growing area of federal spending. Agencies are increasingly migrating services to the cloud for cost savings, scalability, and enhanced capabilities. Oracle Cloud Infrastructure (OCI) is a significant player in this market, competing with providers like AWS, Azure, and Google Cloud. This contract represents a specific investment within the broader trend of federal agencies adopting cloud-based solutions for mission-critical applications and data management.

Small Business Impact

This contract does not appear to have a small business set-aside. The award is to Emergent, LLC. Analysis of subcontracting opportunities for small businesses would require further investigation into the contractor's subcontracting plan, if applicable. Without specific set-aside provisions, the direct impact on the small business ecosystem is likely minimal unless Emergent, LLC actively engages small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Health and Human Services (HHS) and specifically the National Institutes of Health (NIH). Contract administration and performance monitoring are standard oversight mechanisms. Transparency is facilitated by contract databases like FPDS. The Inspector General of HHS would have jurisdiction to investigate any potential fraud, waste, or abuse related to this award.

Related Government Programs

HHS IT Modernization Initiatives
NIH Research Data Management Services
Federal Cloud Computing Strategy
Oracle Software and Services Contracts
Health Information Technology Services

Risk Flags

Potential for vendor lock-in
Contractor performance risk
Data security and compliance
Scope creep risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $11.1 million to EMERGENT, LLC. ORACLE CLOUD SERVICES FOR THE HHS-ASFR-OF

Who is the contractor on this award?

The obligated recipient is EMERGENT, LLC.

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 $11.1 million.

What is the period of performance?

Start: 2024-04-10. End: 2027-04-09.

What is Emergent, LLC's track record with providing Oracle cloud services to federal agencies?

Assessing Emergent, LLC's track record requires a review of their past federal contract performance, particularly for similar Oracle cloud services. This would involve examining past performance evaluations, any reported issues or disputes, and the successful completion of previous contracts. Without specific data on Emergent, LLC's history with Oracle cloud services, it's difficult to definitively gauge their capability and reliability for this HHS contract. A deeper dive into contract databases and agency performance reports would be necessary to provide a comprehensive assessment of their suitability and past performance.

How does the awarded price compare to market rates for similar Oracle cloud services?

Determining if the $11.1 million award represents good value requires benchmarking against market rates for comparable Oracle cloud services. This involves analyzing pricing structures for similar service levels, data storage, processing power, and support agreements offered by Oracle or other cloud providers. Factors such as contract duration, service level agreements (SLAs), and specific features included in the package influence pricing. A comprehensive market analysis, potentially involving consultation with industry experts or review of competitive bids (if available), would be needed to ascertain if this contract's pricing is competitive and reflects fair market value for the services rendered.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this contract?

The provided data does not specify the Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this Oracle cloud services contract. These are critical components that define the expected performance standards, uptime guarantees, response times for support, and data security measures. Without these details, it is challenging to objectively measure the contractor's performance and ensure the government is receiving the agreed-upon level of service. A thorough review of the contract document itself would be necessary to identify these crucial performance metrics and understand the remedies for non-compliance.

What is the historical spending pattern for Oracle cloud services at HHS or NIH?

To understand the historical spending on Oracle cloud services at HHS or NIH, one would need to analyze past contract awards for similar services over several fiscal years. This involves querying federal procurement databases (like FPDS) for contracts awarded to Oracle or its partners for cloud-based solutions within these agencies. Examining trends in spending volume, contract types, and the number of awarded contracts can reveal patterns of adoption, investment levels, and reliance on Oracle's cloud offerings. This historical context is crucial for evaluating the current $11.1 million award as part of a larger strategic investment or a one-time procurement.

What are the potential risks associated with relying on Emergent, LLC for critical cloud infrastructure?

Potential risks associated with relying on Emergent, LLC for critical cloud infrastructure include performance issues, security vulnerabilities, and financial stability of the contractor. If Emergent, LLC fails to meet performance standards or experiences outages, it could disrupt vital NIH operations. Security breaches could compromise sensitive health data, leading to significant regulatory and reputational damage. Furthermore, the financial health of Emergent, LLC is a factor; any instability could jeopardize service continuity. Mitigation strategies typically involve robust contract oversight, clear SLAs, contingency planning, and regular performance reviews.

How does this contract align with HHS's broader IT modernization and cloud adoption strategy?

This contract for Oracle cloud services likely aligns with HHS's broader IT modernization and cloud adoption strategy by providing essential infrastructure for data management and application hosting. Federal agencies, including HHS, are increasingly moving towards cloud solutions to enhance agility, scalability, and cost-efficiency. By procuring these services, HHS is enabling its components, like NIH, to leverage modern cloud capabilities for research, data analysis, and operational support. The specific alignment would depend on the details of HHS's strategic plan, but generally, such contracts are seen as steps towards a more flexible and robust IT environment.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - STORAGE

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

Parent Company: Mythics, Inc.

Address: 4525 MAIN ST STE 1500, VIRGINIA BEACH, VA, 23462

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

Financial Breakdown

Contract Ceiling: $24,988,156

Exercised Options: $11,109,982

Current Obligation: $11,109,982

Actual Outlays: $3,748,087

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: HHSN316201500013W

IDV Type: GWAC

Timeline