HHS awards $50M for biological product manufacturing, with a focus on shelf-life clarification

Contract Overview

Contract Amount: $49,999,746 ($50.0M)

Contractor: Glaxosmithkline, LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2017-09-20

End Date: 2018-12-31

Contract Duration: 467 days

Daily Burn Rate: $107.1K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: MODIFICATION 00001: CLARIFICATION OF SHELF-LIFE DATING

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 $50.0 million to GLAXOSMITHKLINE, LLC for work described as: MODIFICATION 00001: CLARIFICATION OF SHELF-LIFE DATING Key points: 1. Contract value of nearly $50 million indicates significant investment in biological product manufacturing capabilities. 2. The modification's focus on shelf-life dating suggests a need for improved product longevity and reliability. 3. Competition dynamics appear robust, with a 'FULL AND OPEN COMPETITION' award type. 4. The contract duration of over a year points to a sustained need for these manufacturing services. 5. The award to GlaxoSmithKline, LLC, a major pharmaceutical player, suggests a reliance on established industry leaders for critical supplies. 6. The North Carolina location of the contractor may have implications for regional economic impact and workforce development.

Value Assessment

Rating: good

The contract value of approximately $50 million for biological product manufacturing is substantial. Benchmarking this against similar contracts for specialized manufacturing services would provide a clearer picture of value for money. However, the modification's focus on shelf-life dating suggests a specific, potentially high-value improvement to existing processes or products, which could justify the expenditure. Without direct cost breakdowns for the shelf-life clarification, a precise value-for-money assessment is challenging, but the overall investment aligns with the critical nature of biological product supply chains.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION,' indicating that all responsible sources were permitted to submit bids. This suggests a competitive process aimed at securing the best value for the government. The specific number of bidders is not provided, but the designation implies a healthy level of market interest and potential for price discovery.

Taxpayer Impact: A full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to more favorable pricing and innovative solutions.

Public Impact

The primary beneficiaries are likely the Department of Health and Human Services (HHS) and potentially the public, through the ensured availability and improved quality of biological products. The services delivered involve the manufacturing of biological products, with a specific emphasis on clarifying shelf-life dating, which is crucial for product efficacy and safety. The geographic impact is primarily centered around the contractor's facilities in North Carolina, potentially creating or sustaining jobs in that region. Workforce implications include the need for skilled labor in biological manufacturing, quality control, and potentially research and development related to shelf-life extension.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific details on the 'shelf-life dating' clarification makes it difficult to assess the precise technical challenges or risks involved.
The contract value, while substantial, does not provide a breakdown of costs associated with the modification, hindering a granular value analysis.
Limited information on the number of bidders in the full and open competition makes it hard to gauge the intensity of market pressure on pricing.

Positive Signals

Awarded under full and open competition, suggesting a robust and fair bidding process.
The modification indicates a proactive approach to improving product quality and reliability through shelf-life clarification.
The contractor, GlaxoSmithKline, LLC, is a well-established entity in the pharmaceutical and biological products sector, implying a high level of expertise and capability.

Sector Analysis

This contract falls within the broader 'Healthcare' and 'Biotechnology' sectors, specifically focusing on the manufacturing of biological products. The market for such specialized manufacturing is often characterized by high barriers to entry due to regulatory requirements, technical expertise, and capital investment. Spending in this area is critical for public health preparedness and the supply of essential medical countermeasures. Comparable spending benchmarks would typically involve analyzing other government contracts for similar biological manufacturing services, particularly those related to vaccine or therapeutic production.

Small Business Impact

The provided data indicates that small business participation (ss: false, sb: false) was not a primary set-aside criterion for this specific award. Therefore, the direct impact on small businesses through set-asides is likely minimal. However, the prime contractor, GlaxoSmithKline, LLC, may engage small businesses as subcontractors, contributing indirectly to the small business ecosystem. Further analysis would be needed to determine the extent of any subcontracting plans.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Health and Human Services (HHS), specifically the Office of Assistant Secretary for Preparedness and Response (ASPR). Accountability measures are embedded in the contract terms, including performance requirements and delivery schedules. Transparency is facilitated through contract databases like FPDS. The Inspector General of HHS would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

HHS Biological Product Procurement
Biopharmaceutical Manufacturing Contracts
Public Health Emergency Preparedness
Medical Countermeasure Development
Shelf-Life Extension Studies

Risk Flags

Potential for unforeseen technical challenges in shelf-life clarification.
Reliance on a single contractor for critical biological product manufacturing.
Need for detailed cost breakdown to fully assess value for money.
Limited information on the number of bidders in the competitive process.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $50.0 million to GLAXOSMITHKLINE, LLC. MODIFICATION 00001: CLARIFICATION OF SHELF-LIFE DATING

Who is the contractor on this award?

The obligated recipient is GLAXOSMITHKLINE, LLC.

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 $50.0 million.

What is the period of performance?

Start: 2017-09-20. End: 2018-12-31.

What is the specific nature of the 'shelf-life dating' clarification, and what are the expected benefits?

The modification 'MODIFICATION 00001: CLARIFICATION OF SHELF-LIFE DATING' suggests that the original contract may have had ambiguities or required updates regarding the expiration periods of the biological products being manufactured. The specific nature of this clarification is not detailed in the provided data. However, the expected benefits would likely include enhanced product usability, reduced waste due to premature expiration, improved inventory management for the government, and potentially extended availability of critical medical supplies during emergencies. Clarifying shelf-life is crucial for ensuring the efficacy and safety of biological products over time, especially for products intended for long-term storage or use in public health responses.

How does the contract value of approximately $50 million compare to typical spending for biological product manufacturing?

The contract value of approximately $50 million is a significant sum, indicative of a substantial manufacturing effort. To benchmark this effectively, one would need to compare it against historical spending data for similar biological product manufacturing contracts awarded by HHS or other federal agencies. Factors influencing this value include the type and quantity of biological products, the complexity of the manufacturing process, and the duration of the contract. Without access to a broader dataset of comparable contracts, it's challenging to definitively state if $50 million represents high, low, or average spending. However, given the specialized nature and regulatory hurdles in biological manufacturing, such a value is not unusual for large-scale production or development efforts.

What are the potential risks associated with a contract focused on biological product manufacturing and shelf-life clarification?

Potential risks in biological product manufacturing include manufacturing defects, contamination, failure to meet stringent quality control standards, and supply chain disruptions. Specifically related to shelf-life clarification, risks could involve unforeseen scientific challenges in extending product viability, potential for inaccurate dating leading to the use of degraded products, or regulatory hurdles in approving extended shelf-lives. Furthermore, reliance on a single contractor, even if awarded through full and open competition, can pose a risk if that contractor faces operational issues. The modification itself suggests a potential risk that the original shelf-life parameters were inadequate or required adjustment, highlighting the inherent complexities and uncertainties in biological product management.

What is the track record of GlaxoSmithKline, LLC in fulfilling federal contracts, particularly within the healthcare and biological product sectors?

GlaxoSmithKline, LLC (GSK) is a major global pharmaceutical and biotechnology company with a long history of research, development, and manufacturing of vaccines and medicines. As such, they possess extensive experience and a significant track record in fulfilling contracts related to biological products. While specific details of their past federal contract performance are not provided here, GSK is known to be a significant supplier to government health agencies worldwide, including the U.S. government, for various pharmaceutical and biological products. Their established infrastructure, regulatory expertise, and manufacturing capacity generally position them as a reliable partner for complex government procurements in this sector. Any assessment of their track record would typically involve reviewing past performance evaluations and contract completion data.

How does the 'FULL AND OPEN COMPETITION' award type influence the government's ability to secure competitive pricing for biological product manufacturing?

The 'FULL AND OPEN COMPETITION' award type is designed to maximize competition by allowing all responsible sources to submit offers. This process is generally considered the most effective method for the government to achieve competitive pricing. By opening the bidding to the widest possible pool of qualified contractors, the government increases the likelihood of receiving multiple proposals, which in turn drives down prices through market forces. It also encourages innovation as contractors vie to offer the most attractive technical solutions and cost proposals. Therefore, this award type suggests that the government has taken steps to ensure it is obtaining favorable pricing and value for the $50 million allocated to biological product manufacturing and shelf-life clarification.

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: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Glaxosmithkline PLC (UEI: 238980408)

Address: 5 MOORE DR, RESEARCH TRIANGLE PARK, NC, 27709

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

Financial Breakdown

Contract Ceiling: $49,999,746

Exercised Options: $49,999,746

Current Obligation: $49,999,746

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NOT OBTAINED - WAIVED

Parent Contract

Parent Award PIID: HHSD200201460289I

IDV Type: IDC

Timeline