HHS awards $925M Pfizer contract for children's vaccines in 2013
Contract Overview
Contract Amount: $925,342,194 ($925.3M)
Contractor: Pfizer Inc.
Awarding Agency: Department of Health and Human Services
Start Date: 2013-04-01
End Date: 2014-03-31
Contract Duration: 364 days
Daily Burn Rate: $2.5M/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 5
Pricing Type: FIRM FIXED PRICE
Sector: Healthcare
Official Description: VACCINE FOR CHILDREN 2013
Place of Performance
Location: COLLEGEVILLE, MONTGOMERY County, PENNSYLVANIA, 19426
Plain-Language Summary
Department of Health and Human Services obligated $925.3 million to PFIZER INC. for work described as: VACCINE FOR CHILDREN 2013 Key points: 1. Significant contract value of $925M awarded to Pfizer. 2. Pfizer is a major player in the pharmaceutical industry. 3. Potential risk associated with reliance on a single supplier for critical vaccines. 4. Spending falls within the Pharmaceutical Preparation Manufacturing sector.
Value Assessment
Rating: good
The contract value of $925M for pharmaceutical preparation manufacturing is substantial. Benchmarking against similar large-scale vaccine procurements would be necessary for a precise assessment, but it appears to be within a reasonable range for a major public health initiative.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a competitive bidding process. This method is generally effective in achieving fair market prices and ensuring value for taxpayer money.
Taxpayer Impact: The competitive award process likely ensured a fair price, maximizing the value of taxpayer funds allocated for this critical public health need.
Public Impact
Ensures availability of essential vaccines for children, supporting public health. Supports a major pharmaceutical manufacturer, potentially impacting the broader healthcare industry. Highlights government's role in securing critical medical supplies.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for price increases in future contract renewals.
- Dependence on a single supplier could pose supply chain risks.
Positive Signals
- Secured critical vaccine supply for children.
- Utilized full and open competition for procurement.
Sector Analysis
This contract falls under Pharmaceutical Preparation Manufacturing, a sector critical for public health. Spending benchmarks for similar large-scale vaccine procurements would provide further context on the efficiency of this award.
Small Business Impact
The data does not indicate specific involvement or benefit to small businesses in this particular contract award. Large pharmaceutical contracts often involve major corporations.
Oversight & Accountability
The contract was awarded by the Department of Health and Human Services (HHS) through the Centers for Disease Control and Prevention (CDC), indicating established oversight mechanisms for public health procurements.
Related Government Programs
- Pharmaceutical Preparation Manufacturing
- Department of Health and Human Services Contracting
- Centers for Disease Control and Prevention Programs
Risk Flags
- Potential for future price increases.
- Supply chain dependency on a single manufacturer.
- Limited visibility into contractor's cost structure.
- Long-term implications for market competition.
Tags
pharmaceutical-preparation-manufacturing, department-of-health-and-human-services, pa, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $925.3 million to PFIZER INC.. VACCINE FOR CHILDREN 2013
Who is the contractor on this award?
The obligated recipient is PFIZER 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 $925.3 million.
What is the period of performance?
Start: 2013-04-01. End: 2014-03-31.
What was the specific rationale for awarding such a large sum to a single entity, even under full and open competition?
While awarded under full and open competition, the large sum suggests a significant quantity or a complex manufacturing process for the vaccines. The rationale likely involved meeting projected public health needs, ensuring a stable supply chain, and potentially leveraging economies of scale offered by a major manufacturer like Pfizer. Further details on the specific vaccine and its market dynamics would clarify the award justification.
What are the long-term risks associated with relying on Pfizer for a substantial portion of children's vaccine supply?
Long-term reliance on a single supplier like Pfizer can create vulnerabilities. Risks include potential price escalations in future contracts, supply chain disruptions due to unforeseen events affecting Pfizer, and reduced incentive for innovation if competition is limited in subsequent procurements. Diversifying suppliers or exploring alternative vaccine technologies could mitigate these risks.
How effectively did the firm fixed price contract structure protect taxpayer interests over the contract duration?
A firm fixed price contract is designed to shift risk to the contractor, providing cost certainty for the government. This structure is generally effective in protecting taxpayer interests by capping the government's financial exposure. However, if the initial price was set too high due to flawed market analysis or if unforeseen cost savings were realized by the contractor, taxpayers might not have received the best possible value.
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
Solicitation ID: 2013N14972
Offers Received: 5
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Pfizer Inc (UEI: 001326495)
Address: 500 ARCOLA RD, COLLEGEVILLE, PA, 19426
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $1,280,084,000
Exercised Options: $1,280,084,000
Current Obligation: $925,342,194
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Timeline
Start Date: 2013-04-01
Current End Date: 2014-03-31
Potential End Date: 2014-03-31 00:00:00
Last Modified: 2019-07-17
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