NIH awards $19M for biomedical research to Kaiser Foundation, highlighting long-term R&D investment

Contract Overview

Contract Amount: $19,071,626 ($19.1M)

Contractor: Kaiser Foundation Health Plan of Washington

Awarding Agency: Department of Health and Human Services

Start Date: 2007-11-01

End Date: 2017-12-31

Contract Duration: 3,713 days

Daily Burn Rate: $5.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 13

Pricing Type: COST NO FEE

Sector: R&D

Official Description: BIOMEDICAL (APPLIED/EXPLORATORY)

Place of Performance

Location: SEATTLE, KING County, WASHINGTON, 98101

State: Washington Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $19.1 million to KAISER FOUNDATION HEALTH PLAN OF WASHINGTON for work described as: BIOMEDICAL (APPLIED/EXPLORATORY) Key points: 1. Contract awarded through full and open competition, suggesting a robust selection process. 2. Long contract duration of over 10 years indicates a significant, ongoing research commitment. 3. Research and Development in Physical, Engineering, and Life Sciences sector is critical for innovation. 4. The 'Cost No Fee' contract type suggests a focus on cost recovery for the contractor rather than profit. 5. Geographic focus on Washington state may indicate regional research strengths or priorities. 6. The specific NAICS code points to applied and exploratory research, not basic biotechnology.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without more specific performance metrics and comparable project costs. The 'Cost No Fee' structure implies that the government reimburses allowable costs, with no additional profit margin for the contractor. This can be cost-effective if costs are well-managed, but it also means the government bears the risk of cost overruns. The total award amount of $19M over 10 years averages to $1.9M annually, which appears reasonable for a sustained biomedical research effort, but a detailed cost-benefit analysis would be needed for a definitive assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple potential bidders were allowed to submit proposals. The presence of 13 bids suggests a competitive environment, which typically leads to better pricing and innovation. The specific number of bidders provides a good indication of market interest and the availability of qualified contractors for this type of biomedical research.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down costs and improve the quality of services received.

Public Impact

The primary beneficiaries are likely researchers and institutions within the biomedical field, advancing scientific knowledge. Services delivered include applied and exploratory research in physical, engineering, and life sciences. The geographic impact is centered in Washington state, potentially supporting local research infrastructure and expertise. Workforce implications include support for scientists, technicians, and administrative staff involved in the research project.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'Cost No Fee' contract type shifts cost overrun risk to the government.
Long contract duration may present challenges in adapting to evolving research needs or technologies.
Lack of specific performance metrics in the provided data makes it difficult to assess research effectiveness.

Positive Signals

Awarded through full and open competition, indicating a competitive process.
The substantial funding over a decade suggests a commitment to important, long-term research goals.
The specific NAICS code indicates a focus on applied and exploratory research, potentially leading to practical advancements.

Sector Analysis

The biomedical research sector is characterized by significant investment in innovation and development. This contract falls under the 'Research and Development in the Physical, Engineering, and Life Sciences' category, which is a crucial area for scientific advancement. The market size for biomedical R&D is substantial, driven by government funding, private investment, and the pursuit of new treatments and technologies. Comparable spending benchmarks would typically involve analyzing other NIH grants and contracts awarded for similar research scopes and durations.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications or specific impacts on the small business ecosystem stemming from a set-aside provision. The focus was on full and open competition, which may include large and small businesses, but without a specific set-aside, the direct benefit to small businesses is not guaranteed.

Oversight & Accountability

Oversight for this contract would typically be managed by the National Institutes of Health (NIH), a division of the Department of Health and Human Services. Accountability measures would be embedded in the contract terms, requiring the contractor to meet specific research objectives and reporting requirements. Transparency is generally maintained through contract databases and public reporting of research outcomes, although detailed day-to-day oversight is internal to the agency. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

National Institutes of Health Research Grants
Biomedical Research and Development
Life Sciences Research Contracts
Applied Research Funding
Health and Human Services Contracts

Risk Flags

Long contract duration may limit adaptability to evolving research landscapes.
Cost No Fee contract shifts cost overrun risk to the government.
Specific performance metrics not detailed, impacting effectiveness assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $19.1 million to KAISER FOUNDATION HEALTH PLAN OF WASHINGTON. BIOMEDICAL (APPLIED/EXPLORATORY)

Who is the contractor on this award?

The obligated recipient is KAISER FOUNDATION HEALTH PLAN OF WASHINGTON.

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 $19.1 million.

What is the period of performance?

Start: 2007-11-01. End: 2017-12-31.

What is the track record of Kaiser Foundation Health Plan of Washington in securing and managing federal research contracts?

Information on Kaiser Foundation Health Plan of Washington's specific track record with federal research contracts is not detailed in the provided data. However, their selection for a $19M contract by the NIH suggests they possess the necessary qualifications and capabilities to undertake significant biomedical research projects. Further investigation into their past performance on similar government contracts, including any awards, penalties, or successful project completions, would be necessary for a comprehensive assessment of their track record. Agencies often maintain internal performance evaluations for contractors, which can provide deeper insights into reliability and effectiveness.

How does the $19M award compare to typical NIH funding for similar biomedical research projects?

The $19M award over approximately 10 years averages to $1.9M per year. This funding level is substantial and aligns with significant, long-term research initiatives often supported by the NIH. The NIH funds a wide range of projects, from small grants for exploratory research to large, multi-year center grants and contracts. Without knowing the specific research aims and scope, it's difficult to provide a precise benchmark. However, for applied and exploratory research in the physical, engineering, and life sciences, this award size is within the range of major federal research investments, indicating a significant commitment to the project's objectives.

What are the primary risks associated with a 'Cost No Fee' contract for biomedical research?

The primary risk associated with a 'Cost No Fee' (CNF) contract is that the government bears the financial risk of cost overruns. While the contractor does not earn a profit, they are reimbursed for allowable costs incurred. If the research proves more expensive than initially estimated due to unforeseen challenges, scope changes, or inefficient management, the total cost to the government can exceed initial projections. The government's ability to manage and control these costs relies heavily on robust oversight, clear contract terms, and the contractor's diligent cost management practices. The absence of a profit motive for the contractor might also, in some scenarios, reduce incentives for extreme efficiency, though this is often mitigated by performance expectations.

How effective is 'full and open competition' in ensuring value for money in R&D contracts?

Full and open competition is generally considered the most effective method for ensuring value for money in R&D contracts. By allowing all responsible sources to submit proposals, it maximizes the pool of potential contractors, fostering a competitive environment. This competition drives innovation, encourages cost-consciousness, and allows the government to select the offer that represents the best overall value, considering technical merit, past performance, and price. The presence of 13 bids in this specific case suggests a healthy level of competition, increasing the likelihood that the selected proposal offered a strong balance of scientific quality and cost-effectiveness for the NIH.

What are the implications of the contract's long duration (over 10 years) for research adaptability?

A long contract duration, such as the 10+ years for this biomedical research project, signifies a commitment to a sustained research effort, which is often necessary for complex scientific endeavors. However, it also presents challenges regarding adaptability. Scientific fields, especially in biomedical research, evolve rapidly. A lengthy contract may need built-in mechanisms for flexibility, allowing for adjustments to research directions, methodologies, or objectives based on emerging discoveries or changing priorities. Without such flexibility, the research could become outdated or less relevant over time. The agency's oversight is crucial in managing this balance between long-term commitment and the need for scientific agility.

How does the NAICS code '541712' (Research and Development in the Physical, Engineering, and Life Sciences except Biotechnology) shape the understanding of this contract's scope?

The NAICS code 541712 specifically defines the contract's scope as encompassing research and development activities within the physical, engineering, and life sciences, explicitly excluding biotechnology. This means the research is likely focused on areas such as materials science, environmental science, advanced manufacturing processes, or fundamental biological processes not directly related to genetic engineering or biopharmaceutical development. Understanding this distinction is crucial for assessing the contract's alignment with specific scientific domains and for comparing it to other R&D contracts that might fall under different, more specialized NAICS codes, such as those for biotechnology or medical research.

Industry Classification

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

Product/Service Code: RESEARCH AND DEVELOPMENT › N – Health R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: RFPNIHNIAIDDMID0803

Offers Received: 13

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Parent Company: Kaiser Foundation Health Plan, Inc. (UEI: 071695183)

Address: 600 UNIVERSITY ST STE 3100, SEATTLE, WA, 98101

Business Categories: Category Business, Nonprofit Organization, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $24,921,729

Exercised Options: $24,921,729

Current Obligation: $19,071,626

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline