NIH awards $28M to Charles River Laboratories for veterinary services over 10 years

Contract Overview

Contract Amount: $27,994,536 ($28.0M)

Contractor: Charles River Laboratories, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2001-05-23

End Date: 2011-09-29

Contract Duration: 3,781 days

Daily Burn Rate: $7.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: Healthcare

Official Description: VETERINARY/ANIMAL CARE SERVICES

Place of Performance

Location: WILMINGTON, MIDDLESEX County, MASSACHUSETTS, 01887

State: Massachusetts Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $28.0 million to CHARLES RIVER LABORATORIES, INC. for work described as: VETERINARY/ANIMAL CARE SERVICES Key points: 1. Contract awarded on a sole-source basis, raising questions about price discovery and potential for overpayment. 2. Long contract duration (over 10 years) may not reflect current market conditions or evolving needs. 3. The contract type (Cost Plus Fixed Fee) can incentivize cost increases, requiring robust oversight. 4. Lack of competition suggests potential missed opportunities for cost savings through a competitive bidding process. 5. Services provided are critical for NIH research, indicating a high level of reliance on the contractor. 6. The contractor has a significant tenure with this award, suggesting a stable but potentially entrenched relationship.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its sole-source nature and long duration. Without competitive bids, it's difficult to ascertain if the pricing reflects fair market value. The Cost Plus Fixed Fee structure, while common for complex services, requires diligent oversight to manage costs effectively. Comparing this to similar, competitively awarded veterinary service contracts would be necessary to assess value for money, but such data is not readily available for this specific award.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when a specific contractor possesses unique capabilities or when circumstances preclude full and open competition. The lack of competition means that taxpayers did not benefit from the price discovery mechanisms inherent in a competitive bidding process, potentially leading to higher costs.

Taxpayer Impact: The absence of competition means that taxpayers may not have received the best possible price for these essential services. A competitive process could have driven down costs through bidding.

Public Impact

Researchers at the National Institutes of Health benefit from the continuity of essential animal care and veterinary services, enabling uninterrupted scientific endeavors. The contract supports critical biomedical research, potentially leading to advancements in human and animal health. Services are delivered within the facilities of the National Institutes of Health, primarily impacting the research ecosystem in Massachusetts. The contract supports specialized roles within the veterinary and animal care field, contributing to the scientific workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and may result in suboptimal value for taxpayer funds.
Cost Plus Fixed Fee contract type can create incentives for increased spending, necessitating stringent oversight.
Long contract duration (over 10 years) may not align with current market rates or evolving technological needs.
Lack of transparency in the sole-source justification could obscure potential alternatives or cost-saving measures.

Positive Signals

Contractor provides essential services critical to the mission of the National Institutes of Health.
Long-standing relationship suggests contractor reliability and established operational capacity.
The award ensures continuity of vital research support, preventing disruptions to ongoing scientific projects.

Sector Analysis

This contract falls within the Facilities Support Services sector, specifically focusing on specialized veterinary and animal care services. This is a niche but critical area supporting biomedical research. The market for such services is often characterized by specialized expertise and regulatory compliance. Comparable spending benchmarks would typically involve other government contracts for similar animal care and facility support at research institutions, which can vary significantly based on scale and specific requirements.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb: false'. There is no explicit information regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific contract is likely minimal, unless the prime contractor voluntarily engages small businesses for support services.

Oversight & Accountability

Oversight for this contract would primarily fall under the National Institutes of Health (NIH) contracting officers and program managers. Given the Cost Plus Fixed Fee structure, rigorous financial oversight and performance monitoring are crucial to ensure costs are reasonable and allocable, and that the fixed fee is earned. Transparency regarding the sole-source justification and contract performance metrics would be key accountability measures. The Inspector General for the Department of Health and Human Services would have jurisdiction for audits and investigations if concerns arise.

Related Government Programs

Veterinary Services
Animal Care
Research Support Services
Facilities Management
Biomedical Research Contracts

Risk Flags

Sole-source award
Cost-plus contract type
Long contract duration
Lack of competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $28.0 million to CHARLES RIVER LABORATORIES, INC.. VETERINARY/ANIMAL CARE SERVICES

Who is the contractor on this award?

The obligated recipient is CHARLES RIVER LABORATORIES, INC..

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 $28.0 million.

What is the period of performance?

Start: 2001-05-23. End: 2011-09-29.

What is the justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was awarded as 'NOT COMPETED' and is 'sole-source'. While the specific justification is not detailed in the provided data, sole-source awards are typically made when only one responsible source is available or capable of providing the required services. This could be due to unique capabilities, proprietary technology, or urgent needs where competition is not feasible. For a contract of this duration and value, a thorough justification would typically be required by federal acquisition regulations, often involving market research to confirm the lack of alternatives and a public notice period to allow for challenges.

How does the Cost Plus Fixed Fee (CPFF) contract type impact cost control and value for money?

The Cost Plus Fixed Fee (CPFF) contract type allows the contractor to recover all allowable costs plus a predetermined fixed fee, which represents profit. While CPFF contracts are often used for research and development or services where cost estimation is difficult, they can incentivize contractors to incur higher costs, as their profit (the fixed fee) remains constant regardless of the total cost. This necessitates robust government oversight to scrutinize costs, ensure they are reasonable and allocable, and that the contractor is performing efficiently. Without strong oversight, CPFF contracts can lead to higher overall expenditures compared to fixed-price contracts.

What is the historical spending pattern for veterinary/animal care services at NIH?

The provided data reflects a single definitive contract awarded on 2001-05-23 and ending on 2011-09-29, totaling approximately $28 million. This suggests a significant, long-term engagement with Charles River Laboratories for these services over a decade. To understand the broader historical spending pattern, one would need to examine prior and subsequent contracts for similar services awarded by NIH. This would reveal trends in contract values, durations, competition levels, and the number of contractors utilized over time, providing context for the scale and nature of NIH's investment in veterinary and animal care.

What are the risks associated with a sole-source contract of this magnitude and duration?

The primary risks associated with a sole-source contract of this magnitude ($28 million over 10+ years) include a lack of price competition, potentially leading to inflated costs for taxpayers. There's also a risk of contractor complacency or reduced incentive to innovate and improve efficiency due to the absence of competitive pressure. Furthermore, the long duration might mean the contract terms become outdated relative to market advancements or changing agency needs. Without a competitive process, it's harder to ensure the government is receiving the best value and that the contractor is performing at peak efficiency throughout the contract period.

How does the contractor's performance history influence the assessment of this contract?

The provided data indicates Charles River Laboratories, Inc. was awarded this contract. While the data doesn't include specific performance ratings for this contract, the fact that it was a sole-source award lasting over 10 years suggests a level of satisfaction or necessity from the NIH's perspective during that period. However, without access to performance reviews, past performance questionnaires, or contract termination data, a comprehensive assessment of their track record on this specific award is limited. A deeper dive into federal procurement databases and agency records would be needed to evaluate their historical performance objectively.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Parent Company: Charles River Laboratories International, Inc. (UEI: 110376014)

Address: 251 BALLARDVALE ST, WILMINGTON, MA, 01887

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $85,819,318

Exercised Options: $19,022,239

Current Obligation: $27,994,536

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline