HHS awarded $36.6M for licensed smallpox vaccine, with Sanofi Pasteur Biologics as the sole provider

Contract Overview

Contract Amount: $36,630,000 ($36.6M)

Contractor: Sanofi Pasteur Biologics, LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2013-07-10

End Date: 2014-11-01

Contract Duration: 479 days

Daily Burn Rate: $76.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: LICENSED SMALLPOX VACCINE

Place of Performance

Location: CAMBRIDGE, MIDDLESEX County, MASSACHUSETTS, 02139

State: Massachusetts Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $36.6 million to SANOFI PASTEUR BIOLOGICS, LLC for work described as: LICENSED SMALLPOX VACCINE Key points: 1. The contract value of $36.6 million for licensed smallpox vaccine indicates a significant investment in public health preparedness. 2. Sole-source procurement suggests limited market availability or a specific, pre-existing relationship with the supplier. 3. The fixed-price contract type offers cost certainty for the government, mitigating budget overruns. 4. The duration of the delivery order (479 days) points to a medium-term supply need. 5. The absence of small business set-asides may reflect the specialized nature of vaccine manufacturing. 6. The contract's focus on a critical biological product highlights its importance for national health security.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without comparable sole-source procurements for licensed smallpox vaccines. The total award of $36.6 million for a 479-day period suggests a substantial per-unit cost, likely influenced by the specialized manufacturing processes and regulatory requirements for biological products. Further analysis would require understanding the specific quantities procured and comparing them to historical pricing for similar vaccines, if available.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This approach is typically used when only one responsible source is available or when there is a compelling justification for excluding competition. The lack of competition means that the government did not benefit from potential price reductions or innovative solutions that might have emerged from a competitive bidding process.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure. Without multiple bids, there is less assurance that the price reflects the lowest possible cost for the required vaccine.

Public Impact

The Centers for Disease Control and Prevention (CDC) benefits by securing a supply of licensed smallpox vaccine. The service delivered is the provision of a critical biological product essential for public health emergencies and vaccination programs. The geographic impact is national, ensuring availability of the vaccine across the United States. Workforce implications are likely minimal for this specific contract, primarily affecting specialized roles within the manufacturing and supply chain of the awarded contractor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potentially increases costs for taxpayers.
Lack of competition raises questions about market dynamics for this specific vaccine.
Limited transparency on the justification for sole-source procurement.

Positive Signals

Ensures availability of a critical public health resource.
Fixed-price contract provides budget certainty.
Contract awarded to a known entity with likely relevant expertise.

Sector Analysis

The pharmaceutical and biotechnology sector, particularly the biological product manufacturing sub-sector, is characterized by high R&D costs, stringent regulatory oversight, and significant barriers to entry. Contracts for specialized vaccines like smallpox are often sole-sourced due to the limited number of manufacturers capable of producing them to meet federal standards. The market size for such niche biologicals can be difficult to quantify but is driven by national health security needs and potential pandemic preparedness requirements.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to involve significant subcontracting opportunities for small businesses. The manufacturing of specialized biological products like vaccines typically requires extensive infrastructure, expertise, and regulatory compliance that are more commonly found in larger, established firms. Therefore, the direct impact on the small business ecosystem is likely negligible.

Oversight & Accountability

Oversight for this contract would fall under the Centers for Disease Control and Prevention (CDC) within the Department of Health and Human Services. Accountability measures are inherent in the firm fixed-price contract, requiring the contractor to deliver the specified vaccine. Transparency regarding the sole-source justification and the specific terms of the delivery order would be key areas for oversight. The Inspector General of HHS would have jurisdiction over any potential fraud, waste, or abuse related to this award.

Related Government Programs

Strategic National Stockpile
Vaccine and Antiviral Procurement Programs
Public Health Emergency Preparedness
Biodefense and Countermeasures

Risk Flags

Sole-source award
Potential for price inflation due to lack of competition
Supply chain vulnerability due to single supplier reliance

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $36.6 million to SANOFI PASTEUR BIOLOGICS, LLC. LICENSED SMALLPOX VACCINE

Who is the contractor on this award?

The obligated recipient is SANOFI PASTEUR BIOLOGICS, LLC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Centers for Disease Control and Prevention).

What is the total obligated amount?

The obligated amount is $36.6 million.

What is the period of performance?

Start: 2013-07-10. End: 2014-11-01.

What is the specific quantity of licensed smallpox vaccine procured under this contract, and how does the per-unit cost compare to historical benchmarks?

The provided data does not specify the exact quantity of licensed smallpox vaccine procured under this $36.6 million contract. The contract duration is 479 days, indicating a medium-term supply. Without the quantity, calculating a precise per-unit cost is impossible. However, given the specialized nature of vaccine manufacturing, regulatory hurdles, and the sole-source award, the per-unit cost is likely higher than if it were a mass-produced, competitively bid item. Historical data on similar sole-source vaccine procurements would be necessary for a meaningful benchmark comparison, but such data is not readily available in this context.

What was the specific justification for awarding this contract on a sole-source basis to Sanofi Pasteur Biologics, LLC?

The provided data indicates the contract was 'NOT COMPETED' and lists the award type as 'DELIVERY ORDER'. While it confirms a sole-source award, it does not detail the specific justification. Typically, sole-source procurements for specialized items like vaccines are justified under circumstances such as: only one responsible source exists, urgent and compelling needs that preclude competition, or a specific existing relationship or capability that cannot be replicated. For licensed biological products, the unique manufacturing processes, proprietary technology, and stringent regulatory approvals held by a single entity often lead to sole-source awards to ensure supply continuity and product integrity.

What is Sanofi Pasteur Biologics, LLC's track record with federal vaccine contracts, particularly for public health preparedness?

Sanofi Pasteur Biologics, LLC, as part of the larger Sanofi group, has a significant history of supplying vaccines to government agencies, including the U.S. Department of Health and Human Services (HHS) and the Department of Defense. Their track record includes providing various vaccines for influenza, polio, and other infectious diseases, often through competitive contracts and participation in programs like the Strategic National Stockpile. Their experience in large-scale vaccine manufacturing, cold chain logistics, and navigating complex regulatory pathways positions them as a key supplier for national health security initiatives. Specific details on past smallpox vaccine contracts would require further database searches.

How does the $36.6 million award for licensed smallpox vaccine compare to overall federal spending on biological products or public health preparedness?

The $36.6 million award for licensed smallpox vaccine represents a specific investment within the broader federal spending on public health preparedness and biological products. Federal spending in these areas can fluctuate significantly based on perceived threats, existing stockpiles, and research initiatives. For context, annual federal outlays for health research and public health programs often run into the tens of billions of dollars. While $36.6 million is a substantial sum for a single contract, it is a component of a much larger national effort to maintain readiness against biological threats. Comparing it to the total budget for the CDC or HHS's preparedness initiatives would provide a clearer picture of its relative scale.

What are the potential risks associated with relying on a single supplier for a critical vaccine like smallpox?

Relying on a single supplier for a critical vaccine like smallpox introduces several risks. Firstly, there's a risk of supply disruption due to manufacturing issues, quality control problems, or unforeseen events affecting the sole provider. Secondly, the lack of competition can lead to higher prices and reduced incentives for the supplier to innovate or improve efficiency. Thirdly, if the supplier's production capacity is insufficient during a public health emergency, it could lead to critical shortages. Finally, dependence on one entity can create vulnerabilities in national security if that supplier faces geopolitical challenges or business failures.

Industry Classification

NAICS: Manufacturing › Pharmaceutical and Medicine Manufacturing › Biological Product (except Diagnostic) Manufacturing

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 2006N08476

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Sanofi Pasteur Vaxdesign Corp (UEI: 739980787)

Address: 38 SIDNEY ST, CAMBRIDGE, MA, 02139

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

Financial Breakdown

Contract Ceiling: $36,630,000

Exercised Options: $36,630,000

Current Obligation: $36,630,000

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSD200200824959I

IDV Type: IDC

Timeline