HHS awarded GlaxoSmithKline $465M for childhood vaccines in 2010, a significant investment in public health

Contract Overview

Contract Amount: $465,191,757 ($465.2M)

Contractor: Glaxosmithkline Holdings (americas) Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2010-04-01

End Date: 2011-03-31

Contract Duration: 364 days

Daily Burn Rate: $1.3M/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: VACCINE FOR CHILDREN 2010

Place of Performance

Location: DURHAM, DURHAM County, NORTH CAROLINA, 27709

State: North Carolina Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $465.2 million to GLAXOSMITHKLINE HOLDINGS (AMERICAS) INC. for work described as: VACCINE FOR CHILDREN 2010 Key points: 1. The contract aimed to secure a vital supply of vaccines for children, underscoring its public health importance. 2. Competition dynamics for this contract are not detailed, but the award value suggests a significant market. 3. Risk indicators are low given the nature of vaccine procurement, focusing on supply chain reliability and efficacy. 4. Performance context is tied to ensuring adequate vaccine availability for the national immunization program. 5. This contract falls within the broader pharmaceutical and healthcare sector, specifically vaccine manufacturing. 6. The firm fixed-price structure likely provided cost certainty for the government.

Value Assessment

Rating: good

The $465 million award for childhood vaccines represents a substantial commitment by HHS. Benchmarking this specific contract is challenging without more granular data on vaccine types and quantities. However, the scale suggests a significant portion of the national need was addressed. The firm fixed-price contract indicates a negotiated price that the government aimed to control, which is a positive sign for value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of 6 bidders suggests a reasonably competitive environment for this critical pharmaceutical supply. This level of competition is generally favorable for price discovery and ensuring the government receives competitive offers.

Taxpayer Impact: Full and open competition for essential childhood vaccines helps ensure taxpayer dollars are used efficiently by driving down prices through market forces.

Public Impact

Children across the United States benefit from access to essential vaccines, contributing to herd immunity and disease prevention. The service delivered is the procurement and supply of critical pharmaceutical products (vaccines). The geographic impact is national, ensuring vaccine availability across all states and territories. Workforce implications include supporting jobs in pharmaceutical manufacturing, logistics, and public health administration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price fluctuations in future vaccine procurements if competition dynamics change.
Dependence on a single manufacturer for specific vaccine types could pose supply chain risks.
Ensuring equitable distribution and access across diverse socioeconomic and geographic populations.

Positive Signals

Awarding under full and open competition promotes market efficiency.
Firm fixed-price contract provides budget certainty.
Securing a large volume of vaccines addresses a critical public health need.

Sector Analysis

This contract operates within the pharmaceutical manufacturing sector, a critical component of the healthcare industry. The market for childhood vaccines is substantial, driven by national immunization schedules and public health initiatives. This award represents a significant government investment in ensuring the availability of these life-saving products, fitting within the broader landscape of federal health spending and pharmaceutical procurement.

Small Business Impact

Information regarding small business set-asides or subcontracting is not available for this contract. Given the scale and nature of pharmaceutical manufacturing, large prime contractors are typical. Further analysis would be needed to determine if small businesses were involved in the supply chain or as subcontractors.

Oversight & Accountability

Oversight for this contract would fall under the Department of Health and Human Services (HHS) and its relevant agencies, such as the Centers for Disease Control and Prevention (CDC). Accountability measures would include ensuring timely delivery, vaccine quality, and adherence to contract terms. Transparency is generally maintained through contract award databases, though specific performance metrics may not always be publicly disclosed.

Related Government Programs

National Vaccine Injury Compensation Program
HHS Strategic National Stockpile
CDC Immunization Services Division
Pharmaceuticals and Medical Supplies Procurement

Risk Flags

Supply Chain Reliability
Quality Assurance
Cold Chain Management

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $465.2 million to GLAXOSMITHKLINE HOLDINGS (AMERICAS) INC.. VACCINE FOR CHILDREN 2010

Who is the contractor on this award?

The obligated recipient is GLAXOSMITHKLINE HOLDINGS (AMERICAS) INC..

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 $465.2 million.

What is the period of performance?

Start: 2010-04-01. End: 2011-03-31.

What was the specific type and quantity of vaccines procured under this contract?

The provided data does not specify the exact types or quantities of vaccines procured. The contract, 'VACCINE FOR CHILDREN 2010,' awarded to GlaxoSmithKline Holdings (Americas) Inc. for $465,191,757.4, likely covered a range of vaccines included in the national immunization schedule for children. Without a detailed breakdown, it's impossible to determine the precise units or specific vaccine formulations. This information would typically be found in the contract's statement of work or delivery schedules, which are not included in the summary data.

How does the $465 million award compare to annual federal spending on childhood vaccines in surrounding years?

Comparing the $465 million award to surrounding years requires access to historical federal spending data on childhood vaccines. This single contract represents a significant portion of the government's investment in a specific year (2010). Federal spending on vaccines fluctuates based on demand, new vaccine introductions, and procurement strategies. To provide a comparative analysis, one would need to aggregate spending across all vaccine contracts awarded by agencies like HHS/CDC in fiscal years 2009, 2010, and 2011, and then compare this total to the $465 million figure. This would reveal whether this award was typical, above average, or below average for that period.

What is GlaxoSmithKline's track record in supplying vaccines to the U.S. government prior to and after this contract?

GlaxoSmithKline (GSK) has a long-standing history as a major global pharmaceutical company and a significant supplier of vaccines to governments worldwide, including the U.S. Prior to the 2010 contract, GSK was already a key provider of various childhood vaccines. Following this contract, GSK has continued to be a primary supplier for numerous vaccines on the CDC's recommended immunization schedule. Their track record generally involves large-scale manufacturing capabilities, extensive research and development, and navigating complex regulatory approval processes. Assessing their overall track record would involve reviewing performance on other government contracts, any reported supply chain issues, and their market share in vaccine provision.

What were the key performance indicators (KPIs) for this contract, and did the contractor meet them?

The provided summary data does not detail the specific Key Performance Indicators (KPIs) established for this 'VACCINE FOR CHILDREN 2010' contract. Typically, for vaccine procurement contracts, KPIs would focus on factors such as on-time delivery of specified vaccine quantities, maintenance of required temperature controls during transport and storage (cold chain integrity), adherence to quality standards (e.g., sterility, potency), and potentially responsiveness to emergency needs. Without the contract's statement of work or performance reports, it is not possible to determine if GlaxoSmithKline met these specific performance metrics. The 'NC' status for 'State' might indicate 'Not Classified' or a similar administrative code, not a performance outcome.

Were there any significant risks identified during the contract lifecycle, and how were they mitigated?

While the summary data doesn't explicitly list risks for this contract, common risks in large-scale vaccine procurement include supply chain disruptions (manufacturing delays, raw material shortages), quality control failures, transportation issues (cold chain breaches), and potential changes in demand or public health recommendations. Given the firm fixed-price nature, cost overruns due to unforeseen issues would be a primary concern for the contractor. Mitigation strategies typically involve robust quality assurance processes, redundant manufacturing capabilities, strong logistics partnerships, and close communication between the government and the contractor. The government's role often includes monitoring these risks and potentially invoking contract clauses to address failures.

Industry Classification

NAICS: Manufacturing › Pharmaceutical and Medicine Manufacturing › Pharmaceutical Preparation Manufacturing

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Glaxosmithkline PLC

Address: 1105 N MARKET ST, STE 622, WILMINGTON, DE, 19801

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

Financial Breakdown

Contract Ceiling: $465,191,757

Exercised Options: $465,191,757

Current Obligation: $465,191,757

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline