Battelle Memorial Institute's $18M NIH contract for R&D in Physical, Engineering, and Life Sciences shows fair value

Contract Overview

Contract Amount: $18,011,443 ($18.0M)

Contractor: Battelle Memorial Institute

Awarding Agency: Department of Health and Human Services

Start Date: 2005-09-30

End Date: 2010-09-29

Contract Duration: 1,825 days

Daily Burn Rate: $9.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: R AND D - OTHER R AND D RES

Place of Performance

Location: COLUMBUS, FRANKLIN County, OHIO, 43201

State: Ohio Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $18.0 million to BATTELLE MEMORIAL INSTITUTE for work described as: R AND D - OTHER R AND D RES Key points: 1. Contract awarded through full and open competition, suggesting a competitive pricing environment. 2. Performance period of 5 years indicates a significant, long-term research endeavor. 3. Cost Plus Fixed Fee contract type may incentivize cost control by the contractor. 4. The contract's focus on R&D in physical, engineering, and life sciences aligns with NIH's mission. 5. Geographic concentration in Ohio for performance. 6. No small business set-aside was utilized for this contract.

Value Assessment

Rating: fair

The contract's total value of approximately $18 million over five years for R&D services appears reasonable given the scope. Benchmarking against similar NIH contracts for complex research and development would provide a more precise value-for-money assessment. The Cost Plus Fixed Fee (CPFF) structure, while common for R&D, requires careful monitoring to ensure costs remain within expectations and the fixed fee provides adequate incentive for efficient performance. Without specific performance metrics or detailed cost breakdowns, a definitive assessment of cost-effectiveness is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 3 bidders suggests a moderate level of competition for this specific R&D requirement. While multiple bidders are positive, the ultimate impact on price discovery depends on the intensity of the competition and the specific technical requirements that may have limited the pool of highly qualified offerors.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to more favorable pricing and innovative solutions, ensuring federal dollars are used efficiently.

Public Impact

The primary beneficiary is the National Institutes of Health (NIH), which receives critical research and development services. Services delivered include research and development in the physical, engineering, and life sciences, contributing to scientific advancement. The contract's geographic impact is concentrated in Ohio, where Battelle Memorial Institute is headquartered and likely performs the work. Workforce implications include the potential for highly skilled scientists, engineers, and technicians employed by Battelle and its potential subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can sometimes lead to cost overruns if not managed diligently.
Limited competition (3 bidders) might indicate a specialized field where fewer entities possess the required expertise.
The long performance period requires sustained oversight to ensure continued relevance and effectiveness of research.

Positive Signals

Awarded through full and open competition, maximizing the pool of potential offerors.
Battelle Memorial Institute is a well-established research institution with a strong track record.
The contract supports critical R&D aligned with the mission of a major federal health agency.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on physical, engineering, and life sciences. This is a critical area for innovation and scientific advancement, often supported by government agencies like the NIH. The market for R&D services is highly specialized, with a mix of large research institutions, universities, and private companies competing for federal funding. Comparable spending benchmarks would involve analyzing other NIH contracts for similar R&D scope and duration, as well as broader federal R&D spending trends across different scientific disciplines.

Small Business Impact

This contract did not include a small business set-aside, nor is there information indicating significant subcontracting opportunities for small businesses. This suggests that the primary award went to a large research institution. The impact on the small business ecosystem is likely minimal for this specific contract, as the focus appears to be on a large, established entity capable of undertaking complex R&D projects.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officers and program managers at the National Institutes of Health (NIH). As a Cost Plus Fixed Fee contract, rigorous financial oversight is crucial to monitor expenditures and ensure the fixed fee remains appropriate. Transparency is facilitated through contract reporting mechanisms, though detailed public access to R&D progress reports may be limited due to proprietary or sensitive information. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

NIH Research Grants
Department of Defense R&D Contracts
National Science Foundation (NSF) Research Programs
Biomedical Research Initiatives
Engineering Research and Development

Risk Flags

Potential for cost overruns in CPFF contract
Need for strong government oversight of R&D progress
Limited competition may impact price discovery

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $18.0 million to BATTELLE MEMORIAL INSTITUTE. R AND D - OTHER R AND D RES

Who is the contractor on this award?

The obligated recipient is BATTELLE MEMORIAL 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 $18.0 million.

What is the period of performance?

Start: 2005-09-30. End: 2010-09-29.

What is Battelle Memorial Institute's track record with NIH and similar federal agencies for R&D contracts?

Battelle Memorial Institute has a long history of performing research and development for various U.S. federal agencies, including the Department of Defense, Department of Energy, and the National Institutes of Health (NIH). Their extensive experience spans a wide range of scientific and engineering disciplines. For NIH specifically, Battelle has likely been involved in numerous projects supporting biomedical research, health sciences, and related technological advancements. A detailed review of their past performance on similar NIH contracts would reveal their success in meeting technical requirements, managing budgets, and adhering to timelines. Their established reputation as a major research organization suggests a generally positive track record, though specific contract performance data would be needed for a comprehensive assessment.

How does the $18 million value compare to other NIH R&D contracts of similar scope and duration?

The $18 million total value for a 5-year R&D contract is within a moderate range for NIH procurements. NIH funds a vast array of research projects, with contract values varying significantly based on the complexity, scale, and duration of the research. Large-scale, multi-disciplinary R&D efforts can easily exceed tens or even hundreds of millions of dollars. Conversely, smaller, more focused research tasks might be awarded for less. To benchmark this specific contract, one would need to compare it against other NIH contracts awarded for 'Research and Development in the Physical, Engineering, and Life Sciences' (NAICS code 541710) with similar performance periods (around 5 years) and contract types (like CPFF). Without access to a comprehensive database of all NIH contracts and their specific details, a precise comparison is difficult, but $18 million over five years suggests a substantial, but not exceptionally large, investment for a research institution.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D?

The primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D revolve around cost control and contractor incentive. While the fixed fee provides a defined profit margin for the contractor, the 'cost plus' component means the government ultimately reimburses the contractor's allowable costs. If the contractor does not manage costs effectively, the total expenditure can exceed initial estimates, even though the fee remains fixed. This necessitates robust government oversight to scrutinize costs and ensure they are reasonable and allocable to the contract. Another risk is that the contractor might be less motivated to find cost efficiencies compared to a fixed-price contract, as their profit is guaranteed. However, for R&D where the scope can be uncertain, CPFF can be advantageous as it allows flexibility to adapt to evolving research needs while ensuring the contractor is compensated for their efforts and risks.

How effective is Battelle Memorial Institute likely to be in delivering the specified R&D outcomes?

Battelle Memorial Institute's effectiveness in delivering R&D outcomes is generally considered high, given its status as a leading independent research and development organization. They possess extensive facilities, a large pool of scientific and technical talent, and a proven track record in managing complex research projects across various domains, including physical, engineering, and life sciences. The NIH's choice of Battelle suggests confidence in their capabilities. Effectiveness will ultimately depend on the specific project goals, the clarity of the SOW (Statement of Work), the quality of the research team assigned, and the ongoing collaboration and oversight provided by NIH. While past performance is a strong indicator, continuous monitoring of progress, milestones, and deliverables is essential to ensure the contract achieves its intended scientific and technological objectives.

What are the historical spending patterns for R&D in physical, engineering, and life sciences by the NIH?

The NIH is a major funder of biomedical and health-related research in the United States, with significant annual spending allocated to R&D across physical, engineering, and life sciences. Historical spending patterns show a consistent and often increasing investment in these areas, reflecting the nation's priorities in public health, disease prevention, and medical innovation. NIH's budget typically supports a mix of intramural research conducted within its own laboratories and extramural research funded through grants and contracts awarded to universities, research institutions, and private companies. Spending within the 'physical, engineering, and life sciences' category is broad and encompasses everything from basic biological research and drug development to medical device engineering and health data analytics. Trends often reflect emerging scientific fields, public health crises (like pandemics), and advancements in technology that can be applied to health challenges.

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

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 505 KING AVE, COLUMBUS, OH, 43201

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

Financial Breakdown

Contract Ceiling: $123,726,503

Exercised Options: $103,321,373

Current Obligation: $18,011,443

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline