DoD awards $51M for BinaxNow COVID-19 test kits to Abbott Rapid Dx
Contract Overview
Contract Amount: $51,000,000 ($51.0M)
Contractor: Abbott Rapid DX North America LLC
Awarding Agency: Department of Defense
Start Date: 2021-08-05
End Date: 2021-11-30
Contract Duration: 117 days
Daily Burn Rate: $435.9K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Pricing Type: FIRM FIXED PRICE
Sector: Healthcare
Official Description: 8508420509!BINAXNOWTEST KIT (EA)
Place of Performance
Location: ORLANDO, ORANGE County, FLORIDA, 32810
State: Florida Government Spending
Plain-Language Summary
Department of Defense obligated $51.0 million to ABBOTT RAPID DX NORTH AMERICA LLC for work described as: 8508420509!BINAXNOWTEST KIT (EA) Key points: 1. Significant award for essential medical supplies during the pandemic. 2. Abbott Rapid Dx is a major player in diagnostic testing. 3. Potential risk of over-reliance on a single supplier for critical items. 4. Spending falls within the In-Vitro Diagnostic Substance Manufacturing sector.
Value Assessment
Rating: good
The $51 million award for BinaxNow test kits appears reasonable given the urgent demand during the pandemic. Benchmarking against similar large-scale procurements of rapid diagnostic tests would provide further context on pricing efficiency.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' suggesting a limited competition scenario. This approach may have impacted price discovery, potentially leading to higher costs than a fully open competition.
Taxpayer Impact: Taxpayer funds are being used for critical public health supplies. The efficiency of the procurement process directly impacts the value for money received.
Public Impact
Ensures availability of rapid COVID-19 testing, crucial for public health response. Supports the Department of Defense's logistical capabilities in providing essential medical equipment. Impacts the supply chain for diagnostic tests, potentially affecting availability for other agencies or the public.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition may have inflated prices.
- Dependence on a single supplier for critical supplies.
- Short contract duration (117 days) may not reflect long-term needs.
Positive Signals
- Addresses an immediate and critical need for testing.
- Utilizes a known and established supplier.
- Firm fixed price contract provides cost certainty.
Sector Analysis
The procurement falls under the In-Vitro Diagnostic Substance Manufacturing sector, a critical area for public health. Spending benchmarks for similar large-volume diagnostic test procurements would be relevant for assessing value.
Small Business Impact
This award went to a large business (Abbott Rapid Dx North America LLC) and did not include specific set-asides for small businesses. The focus was on rapid delivery of a critical item.
Oversight & Accountability
The Defense Logistics Agency managed this award. Oversight would focus on ensuring timely delivery, quality of the test kits, and adherence to the firm fixed price.
Related Government Programs
- In-Vitro Diagnostic Substance Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Limited competition
- Potential for price inflation due to limited competition
- Sole-source or limited-source nature of the award
- Lack of small business participation
Tags
in-vitro-diagnostic-substance-manufactur, department-of-defense, fl, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $51.0 million to ABBOTT RAPID DX NORTH AMERICA LLC. 8508420509!BINAXNOWTEST KIT (EA)
Who is the contractor on this award?
The obligated recipient is ABBOTT RAPID DX NORTH AMERICA LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $51.0 million.
What is the period of performance?
Start: 2021-08-05. End: 2021-11-30.
What was the rationale for excluding other sources, and did this limit competitive pricing?
The exclusion of sources suggests a specific need or urgency that favored Abbott's product or existing relationship. While potentially expediting delivery, this limitation likely reduced competitive pressure, possibly resulting in a higher per-unit cost compared to a scenario with broader vendor participation.
How does the per-unit cost of these BinaxNow tests compare to other similar rapid diagnostic test procurements by the government?
Without specific per-unit cost data or benchmarks for comparable rapid diagnostic tests procured under similar emergency conditions, it's difficult to definitively assess value. However, given the scale and urgency, the price paid should be evaluated against market rates and other government contracts for similar products during the same period.
What is the long-term strategy for ensuring a stable supply of rapid diagnostic tests beyond this contract?
This contract appears to be a short-term solution for an immediate need. A long-term strategy should involve diversifying suppliers, exploring domestic manufacturing capabilities, and establishing strategic stockpiles to mitigate future supply chain disruptions and ensure consistent availability of essential diagnostic tools.
Industry Classification
NAICS: Manufacturing › Pharmaceutical and Medicine Manufacturing › In-Vitro Diagnostic Substance Manufacturing
Product/Service Code: INSTRUMENTS AND LABORATORY EQPT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Abbott Laboratories
Address: 30 S KELLER RD STE 100, ORLANDO, FL, 32810
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $51,000,000
Exercised Options: $51,000,000
Current Obligation: $51,000,000
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: SPE2DE21D0023
IDV Type: IDC
Timeline
Start Date: 2021-08-05
Current End Date: 2021-11-30
Potential End Date: 2021-11-30 00:00:00
Last Modified: 2025-04-24
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