HHS Awards $78M to Orasure Technologies for COVID-19 Test Industrial Base Expansion

Contract Overview

Contract Amount: $78,124,049 ($78.1M)

Contractor: Orasure Technologies Inc

Awarding Agency: Department of Health and Human Services

Start Date: 2021-09-30

End Date: 2024-03-31

Contract Duration: 913 days

Daily Burn Rate: $85.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: R&D

Official Description: COVID 19 DIB FOR ORASURE TECHNOLOGIES COVID-19 HOME TEST INDUSTRIAL BASE EXPANSION

Place of Performance

Location: BETHLEHEM, NORTHAMPTON County, PENNSYLVANIA, 18015

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $78.1 million to ORASURE TECHNOLOGIES INC for work described as: COVID 19 DIB FOR ORASURE TECHNOLOGIES COVID-19 HOME TEST INDUSTRIAL BASE EXPANSION Key points: 1. Contract supports critical COVID-19 testing infrastructure. 2. Orasure Technologies is the sole awardee, raising questions about competition. 3. The contract value is significant for R&D in the life sciences sector. 4. Fixed-price contract aims to control costs for this expansion.

Value Assessment

Rating: good

The $78.1 million award is substantial, reflecting the urgency of expanding the COVID-19 testing industrial base. Benchmarking against similar R&D contracts for industrial expansion is difficult due to the unique nature of pandemic response.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting multiple bids were considered. The firm fixed-price structure provides cost certainty for the government.

Taxpayer Impact: Taxpayers are funding the expansion of domestic manufacturing capabilities for essential COVID-19 tests, aiming for greater supply chain resilience.

Public Impact

Increases domestic production capacity for COVID-19 tests. Enhances national preparedness for future public health emergencies. Supports technological advancement in diagnostic testing.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole awardee may limit competitive pricing benefits.
Long contract duration (913 days) requires ongoing monitoring.

Positive Signals

Addresses critical need for testing supplies.
Firm fixed price contract provides cost predictability.

Sector Analysis

This contract falls under Research and Development in the Physical, Engineering, and Life Sciences. Spending in this sector is often project-specific and driven by national priorities, making direct comparisons challenging.

Small Business Impact

The contract was awarded to Orasure Technologies Inc., a large business. There is no indication of small business participation in this specific award, which could be an area for future consideration.

Oversight & Accountability

The Department of Health and Human Services, specifically the Office of the Assistant Secretary for Preparedness and Response, is responsible for this award. Oversight will be crucial to ensure the funds are used effectively for industrial base expansion.

Related Government Programs

Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)
Department of Health and Human Services Contracting
Office of Assistant Secretary for Preparedness and Response Programs

Risk Flags

Potential for limited competition impact on final cost.
Long-term sustainability of expanded capacity post-contract.
Dependence on a single contractor for critical infrastructure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $78.1 million to ORASURE TECHNOLOGIES INC. COVID 19 DIB FOR ORASURE TECHNOLOGIES COVID-19 HOME TEST INDUSTRIAL BASE EXPANSION

Who is the contractor on this award?

The obligated recipient is ORASURE TECHNOLOGIES INC.

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 $78.1 million.

What is the period of performance?

Start: 2021-09-30. End: 2024-03-31.

What is the projected increase in testing capacity resulting from this investment?

The contract aims to expand the industrial base for COVID-19 home tests, implying a significant increase in manufacturing capacity. However, specific output targets or projected testing volumes are not detailed in the provided data. Further analysis would require access to the contract's performance metrics and deliverables.

How does the firm fixed price compare to market rates for similar industrial base expansion projects?

Determining a precise market rate comparison for industrial base expansion in a pandemic context is complex. The firm fixed price aims to cap costs for the government, but its competitiveness depends on the specific technologies and manufacturing processes involved. Benchmarking would require detailed cost breakdowns and analysis of comparable government or private sector investments.

What mechanisms are in place to ensure the long-term viability and effectiveness of the expanded industrial base post-contract?

The contract focuses on immediate expansion, but long-term viability requires strategic planning beyond its duration. Mechanisms could include follow-on contracts for sustained production, technology transfer agreements, or incentives for private sector investment. The government's strategy for maintaining this expanded capacity after the contract ends is a key consideration for effectiveness.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)

Product/Service Code: INSTRUMENTS AND LABORATORY EQPT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: TWO STEP

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 220 E 1ST ST, BETHLEHEM, PA, 18015

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

Financial Breakdown

Contract Ceiling: $78,124,049

Exercised Options: $78,124,049

Current Obligation: $78,124,049

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline