Pfizer Inc. awarded $50.16M contract for commodity contracts dealing by USAID, spanning over 5 years

Contract Overview

Contract Amount: $50,161,717 ($50.2M)

Contractor: Pfizer Inc.

Awarding Agency: Agency for International Development

Start Date: 2002-09-25

End Date: 2008-03-31

Contract Duration: 2,014 days

Daily Burn Rate: $24.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PRH/CSL - WYETH (PUBLIC SECTOR) W/N YR OPTION/ADDRS

Plain-Language Summary

Agency for International Development obligated $50.2 million to PFIZER INC. for work described as: PRH/CSL - WYETH (PUBLIC SECTOR) W/N YR OPTION/ADDRS Key points: 1. Contract value of $50.16M over 5 years suggests a significant but potentially reasonable annual spend for the services provided. 2. Full and open competition indicates a healthy market and potential for competitive pricing, though specific bidder numbers are not provided. 3. The contract's duration and fixed-price nature suggest a predictable cost structure, but may limit flexibility for evolving needs. 4. Performance context is limited without specific details on the commodities or services procured, making a direct value assessment challenging. 5. Sector positioning within 'Commodity Contracts Dealing' is broad; understanding the specific commodities is key to assessing its strategic importance. 6. The contract was awarded by the Agency for International Development (USAID), implying a focus on global health or development-related commodities.

Value Assessment

Rating: fair

The total award of $50.16M over approximately 5 years averages to about $10M annually. Without knowing the specific commodities or services procured, it's difficult to benchmark this against similar contracts. However, for a large federal agency like USAID, this annual spend is within a plausible range for significant procurement activities. The firm fixed-price contract type suggests that the pricing was determined upfront, and the value is tied to the delivery of agreed-upon goods or services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which is the preferred method for federal procurements. This suggests that multiple vendors were likely aware of the opportunity and had the chance to submit bids. While the number of bidders is not specified, this level of competition generally promotes price discovery and can lead to more favorable pricing for the government compared to sole-source or limited competition scenarios.

Taxpayer Impact: Taxpayers benefit from full and open competition through the potential for lower prices and a wider selection of qualified vendors, ensuring that government funds are used efficiently.

Public Impact

Beneficiaries likely include international populations served by USAID programs, who receive essential commodities procured through this contract. Services delivered encompass the procurement and potentially distribution of various commodities critical for development and humanitarian aid efforts. Geographic impact is global, as USAID operates in numerous countries, and the commodities procured would support these diverse operational areas. Workforce implications are indirect, primarily affecting the supply chain and logistics sectors involved in commodity management and delivery.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific commodity details limits understanding of potential supply chain risks.
Contract duration of over 5 years could lead to price inflexibility if market conditions change significantly.
Dependence on a single large awardee (Pfizer Inc.) for a broad category of 'commodity contracts dealing' might concentrate risk.

Positive Signals

Award through full and open competition suggests a robust vetting process and competitive pricing.
Firm fixed-price contract provides cost certainty for the government.
Long-term nature of the contract (over 5 years) can foster stability and reliable supply for critical commodities.

Sector Analysis

The 'Commodity Contracts Dealing' NAICS code (523130) is broad and typically associated with financial services or wholesale trade. However, in the context of USAID, it likely refers to the procurement of goods and materials essential for international development and humanitarian aid. This contract fits within the broader government procurement sector, specifically supporting agency operational needs. Comparable spending benchmarks are difficult without knowing the specific commodities, but USAID's overall budget for program support and supplies would be in the billions.

Small Business Impact

There is no indication that this contract included a small business set-aside. Given the scale of the award ($50.16M), it is likely that the prime contractor, Pfizer Inc., is a large business. Subcontracting opportunities for small businesses may exist within the supply chain or logistics supporting the commodity delivery, but this is not explicitly detailed in the provided data.

Oversight & Accountability

Oversight for this contract would primarily fall under the Agency for International Development's contracting officers and program managers. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified commodities. Transparency is generally maintained through federal procurement databases like FPDS-NG, where contract awards are reported. The Inspector General for USAID would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

USAID Global Health Supply Chain Program
USAID Commodity Procurement
Federal Supply Schedule Contracts
Department of Defense Commodity Procurement

Risk Flags

Potential for price escalation over contract duration
Lack of specific commodity details hinders risk assessment
Long-term dependency on a single contractor

Frequently Asked Questions

What is this federal contract paying for?

Agency for International Development awarded $50.2 million to PFIZER INC.. PRH/CSL - WYETH (PUBLIC SECTOR) W/N YR OPTION/ADDRS

Who is the contractor on this award?

The obligated recipient is PFIZER INC..

Which agency awarded this contract?

Awarding agency: Agency for International Development (Agency for International Development).

What is the total obligated amount?

The obligated amount is $50.2 million.

What is the period of performance?

Start: 2002-09-25. End: 2008-03-31.

What specific types of commodities were procured under this contract?

The provided data identifies the contract under NAICS code 523130, 'Commodity Contracts Dealing,' and lists the contractor as Pfizer Inc. However, it does not specify the exact nature of the commodities. Given the awarding agency is USAID, these commodities could range from essential medicines and vaccines for global health initiatives to agricultural supplies, educational materials, or equipment for development projects. A deeper dive into the contract's statement of work or associated documentation would be necessary to ascertain the precise goods procured.

How does the $50.16M award compare to USAID's typical spending on commodity procurement?

The $50.16M award represents a significant sum, averaging approximately $10M per year over its duration. USAID's total budget runs into the billions of dollars annually, with substantial allocations for program implementation and direct support. While this specific contract is large, it needs to be contextualized within USAID's overall procurement portfolio. Without comparative data on other similar commodity contracts awarded by USAID or other agencies involved in international aid, it's challenging to definitively state if this represents high or low spending relative to benchmarks. However, it indicates a substantial commitment to acquiring necessary goods for its missions.

What is Pfizer Inc.'s track record with USAID or similar government contracts?

Pfizer Inc. is a major pharmaceutical and healthcare company with extensive experience in supplying products to government agencies, including the U.S. government and international organizations. While this specific contract is for 'commodity contracts dealing,' Pfizer's core business involves the manufacturing and distribution of pharmaceuticals and vaccines. Their track record likely includes numerous contracts for health-related supplies. A review of federal procurement databases would reveal the full scope of their past performance with USAID and other agencies, including contract values, types, and performance history.

What are the potential risks associated with a contract of this duration and scope?

Contracts spanning over five years, like this one, carry inherent risks. Market prices for commodities can fluctuate significantly over such periods, potentially leading to the government paying above-market rates if the fixed price was set too high initially, or conversely, securing favorable pricing if market rates increase. There's also a risk of technological obsolescence or changes in programmatic needs that the fixed contract may not easily accommodate. Furthermore, a long-term reliance on a single contractor for a broad category of commodities could create dependency and limit the government's agility in responding to unforeseen supply chain disruptions or seeking alternative solutions.

How does the 'full and open competition' aspect influence the value for taxpayers?

The 'full and open competition' designation is a positive indicator for taxpayer value. It means that the solicitation was broadly advertised, allowing any responsible source to submit a bid. This competitive environment typically drives down prices as contractors vie for the award. It also encourages innovation and efficiency, as companies strive to offer the best value proposition. For taxpayers, this translates to a higher likelihood that the government is obtaining goods and services at a fair and reasonable price, maximizing the impact of public funds compared to sole-source or limited competition awards.

What oversight mechanisms are in place for this contract?

Oversight for this contract would be managed by the Agency for International Development (USAID). Key oversight functions include the Contracting Officer's Representative (COR) who monitors performance, ensures compliance with contract terms, and approves deliverables. Regular reporting requirements from the contractor, performance reviews, and financial audits are standard oversight tools. The contract's firm fixed-price nature simplifies some aspects of financial oversight by establishing a clear ceiling, but performance monitoring remains critical to ensure the commodities are delivered as specified and meet quality standards.

Industry Classification

NAICS: Finance and Insurance › Securities and Commodity Contracts Intermediation and Brokerage › Commodity Contracts Dealing

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: M/OAA/GH/HSR-05-2657

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Pfizer Inc (UEI: 001326495)

Address: 500 ARCOLA RD, COLLEGEVILLE, PA, 04

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $173,082,428

Exercised Options: $123,180,448

Current Obligation: $50,161,717

Timeline