NIH awards $11.2M to Southern Research Institute for preclinical drug toxicology and pharmacology research

Contract Overview

Contract Amount: $11,213,439 ($11.2M)

Contractor: Southern Research Institute

Awarding Agency: Department of Health and Human Services

Start Date: 2004-04-01

End Date: 2011-03-31

Contract Duration: 2,555 days

Daily Burn Rate: $4.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 8

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: PRECLINICAL TOXICOLOGY AND PHARMACOLOGY OF DRUGS

Place of Performance

Location: BIRMINGHAM, JEFFERSON County, ALABAMA, 35205

State: Alabama Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $11.2 million to SOUTHERN RESEARCH INSTITUTE for work described as: PRECLINICAL TOXICOLOGY AND PHARMACOLOGY OF DRUGS Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract duration of 2555 days (approx. 7 years) indicates a long-term research commitment. 3. The contract type is Cost Plus Fixed Fee, which can incentivize cost control while allowing for flexibility in research scope. 4. The base award amount of $4.39M suggests significant initial funding for the project. 5. The contract was awarded to a single entity, Southern Research Institute, for specialized research services. 6. The North American Industry Classification System (NAICS) code 541710 points to research and development in life sciences.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific performance metrics or comparable contract data. The Cost Plus Fixed Fee structure means the final cost could exceed the initial award. However, the duration suggests a sustained need for these specialized research services. The fixed fee component provides some predictability for the contractor's profit.

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 a bid. The presence of 8 bidders (no) suggests a reasonably competitive environment for this specialized research service. A higher number of bidders generally leads to better price discovery and potentially lower costs for the government.

Taxpayer Impact: A competitive bidding process helps ensure that taxpayer funds are used efficiently by driving down prices and encouraging innovative solutions from multiple research institutions.

Public Impact

The primary beneficiaries are the National Institutes of Health (NIH) and the broader public, who stand to gain from advancements in drug development. The services delivered include critical preclinical toxicology and pharmacology studies essential for evaluating the safety and efficacy of new drugs. The geographic impact is primarily within Alabama, where Southern Research Institute is located, but the research findings have national and potentially global implications for public health. The contract supports a specialized workforce of scientists and researchers in the life sciences sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can sometimes lead to higher overall costs if not closely managed, as the government bears the risk of cost overruns.
The long duration of the contract may present challenges in adapting to evolving research needs or technological advancements over its lifespan.
Reliance on a single contractor for such a critical research area could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, indicating a robust and fair selection process.
The contract supports critical research and development in the life sciences, aligning with NIH's mission.
The fixed fee component provides a degree of cost certainty for the government regarding contractor profit.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on life sciences and pharmaceutical research. The market for preclinical drug testing services is highly specialized, involving a limited number of research organizations with the necessary expertise and facilities. Comparable spending benchmarks would typically be found within NIH's broader R&D portfolio or through analyses of private sector investment in drug discovery and development.

Small Business Impact

There is no indication that this contract included a small business set-aside. Given the specialized nature of preclinical toxicology and pharmacology, it is likely that larger, established research institutions were the primary bidders. Subcontracting opportunities for small businesses are not explicitly detailed but could potentially exist for specific services or supplies if permitted by the prime contractor.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer's representative (COR) at the NIH, who monitors performance and ensures compliance with contract terms. Accountability measures are inherent in the Cost Plus Fixed Fee structure, requiring detailed reporting of costs and progress. Transparency is facilitated through contract awards databases, though specific research findings are often proprietary until publication or patenting.

Related Government Programs

Pharmaceutical Research and Development
Biotechnology Research
Drug Safety Testing
Clinical Trial Support Services
Life Sciences Research Grants

Risk Flags

Cost Overrun Potential (CPFF)
Long Contract Duration Risk
Reliance on Single Contractor

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $11.2 million to SOUTHERN RESEARCH INSTITUTE. PRECLINICAL TOXICOLOGY AND PHARMACOLOGY OF DRUGS

Who is the contractor on this award?

The obligated recipient is SOUTHERN RESEARCH INSTITUTE.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (National Institutes of Health).

What is the total obligated amount?

The obligated amount is $11.2 million.

What is the period of performance?

Start: 2004-04-01. End: 2011-03-31.

What is the track record of Southern Research Institute in performing similar preclinical research contracts for federal agencies?

Southern Research Institute has a long history of conducting research and development for government agencies, including significant work in preclinical toxicology and pharmacology. While specific details on past federal contracts of identical scope and value are not provided here, their established presence in the R&D sector suggests experience with complex research projects. A deeper dive into their contract history with agencies like NIH, DOD, or others would reveal their performance trends, any past performance issues or commendations, and their success rate in meeting project milestones and deliverables on similar federal awards. This would provide crucial context for assessing their capability to execute the current contract effectively.

How does the awarded amount of $11.2 million compare to similar preclinical research contracts awarded by NIH or other agencies?

The total potential value of $11.2 million for this 7-year contract (2555 days) translates to an average annual value of approximately $1.6 million. Benchmarking this requires comparing it to other contracts for preclinical toxicology and pharmacology services. Contracts of this nature can vary significantly based on the complexity of the research, the number of compounds tested, the specific assays required, and the duration. Without access to a comprehensive database of comparable contracts, it's difficult to definitively state if $11.2 million is high or low. However, given the specialized nature and long-term commitment, this figure appears within a reasonable range for substantial preclinical research efforts, assuming it covers a broad scope of studies.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for preclinical research?

The primary risk with a Cost Plus Fixed Fee (CPFF) contract for preclinical research is that the government bears the majority of the cost risk. If the research encounters unforeseen challenges, requires more resources than initially estimated, or if the contractor's costs escalate, the government will pay the actual allowable costs incurred, plus the pre-negotiated fixed fee. This can lead to the final contract cost exceeding initial projections. For the contractor, the risk is that their actual costs might exceed the estimated costs, but their profit is capped by the fixed fee. Effective oversight, clear definition of scope, and robust cost accounting by the government are crucial to mitigate the risk of cost overruns and ensure value for money.

What is the expected impact of this contract on the development of new drugs and therapies?

This contract is expected to significantly contribute to the drug development pipeline by providing essential preclinical data on the safety and efficacy of potential new drugs. Toxicology studies assess potential harmful effects, while pharmacology studies evaluate how the drug interacts with the body and its therapeutic effects. Positive results from these preclinical stages are critical for determining whether a drug candidate is safe enough to advance to human clinical trials. Therefore, this contract directly supports the foundational research necessary for bringing novel treatments to patients, potentially impacting various disease areas depending on the specific drugs being studied.

How has NIH's spending on preclinical research and development evolved over the past five years?

Analyzing NIH's spending evolution on preclinical research and development over the past five years would require accessing detailed historical budget and contract award data. Generally, NIH's overall budget fluctuates based on congressional appropriations and national health priorities. Spending on preclinical R&D is a significant component, driven by the continuous need to discover and develop new therapies for a wide range of diseases. Trends might show increased investment in specific areas like oncology, infectious diseases, or rare diseases, reflecting current research focuses. A detailed analysis would involve examining annual reports, budget justifications, and contract databases to identify specific spending patterns and growth areas within preclinical R&D.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences

Product/Service Code: RESEARCH AND DEVELOPMENT › OTHER RESEARCH/DEVELOPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 8

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Address: 2000 9TH AVE S, BIRMINGHAM, AL, 90

Business Categories: Category Business, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $157,849,868

Exercised Options: $149,591,106

Current Obligation: $11,213,439

Timeline