Battelle Memorial Institute awarded $124M R&D contract by NIH for physical, engineering, and life sciences research

Contract Overview

Contract Amount: $12,423,327 ($12.4M)

Contractor: Battelle Memorial Institute

Awarding Agency: Department of Health and Human Services

Start Date: 2003-03-15

End Date: 2008-08-31

Contract Duration: 1,996 days

Daily Burn Rate: $6.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Place of Performance

Location: COLUMBUS, FRANKLIN County, OHIO, 43201

State: Ohio Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $12.4 million to BATTELLE MEMORIAL INSTITUTE for work described as: Key points: 1. Contract value of $124M over 5 years suggests significant investment in specialized research capabilities. 2. Full and open competition indicates a potentially robust market for these R&D services. 3. The contract's duration and cost-plus-fixed-fee structure may allow for flexibility but require close oversight. 4. Research and Development in Physical, Engineering, and Life Sciences is a critical sector for innovation and national advancement. 5. The award to a single entity, Battelle Memorial Institute, warrants examination of their specific expertise and capacity. 6. Geographic location in Ohio may point to regional R&D strengths or specific facility requirements.

Value Assessment

Rating: good

The contract value of $124 million over approximately five years for R&D services appears reasonable given the specialized nature of the work. Benchmarking against similar large-scale R&D contracts within the physical, engineering, and life sciences sectors would provide a more precise assessment of value for money. The cost-plus-fixed-fee (CPFF) pricing structure, while common for R&D where scope can evolve, necessitates careful monitoring of costs to ensure efficiency and prevent overruns.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting that multiple qualified vendors had the opportunity to bid. This approach typically fosters a competitive environment, potentially leading to better pricing and innovative solutions. The number of bidders is not specified, but the 'full and open' designation implies a broad solicitation.

Taxpayer Impact: A competitive bidding process for R&D contracts like this one generally benefits taxpayers by driving down costs and encouraging higher quality outcomes through market forces.

Public Impact

The primary beneficiaries are likely the National Institutes of Health (NIH) and the broader scientific community, who will gain from advancements in physical, engineering, and life sciences. The contract supports critical research and development activities that could lead to new technologies, medical breakthroughs, and scientific understanding. The geographic impact is centered in Ohio, where Battelle Memorial Institute is located, potentially stimulating local economic activity and employment in the R&D sector. Workforce implications include the potential for highly skilled scientists, engineers, and technicians to be engaged in cutting-edge research.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts can sometimes lead to less incentive for cost control compared to fixed-price contracts if not managed diligently.
The long duration of the contract (nearly 2 years of performance within a 5-year period) requires sustained oversight to ensure objectives remain aligned with evolving research needs.
Reliance on a single contractor for such a significant R&D effort could pose a risk if unforeseen issues arise with the contractor's performance or capabilities.

Positive Signals

Awarded under full and open competition, indicating a potentially competitive market and a thorough vetting process.
Battelle Memorial Institute is a well-established research institution with a history of government contracting, suggesting a degree of reliability and expertise.
The contract's focus on R&D aligns with national priorities for scientific and technological advancement.

Sector Analysis

The Research and Development in the Physical, Engineering, and Life Sciences sector (NAICS 541710) is a vital component of the U.S. economy, driving innovation and competitiveness. This contract represents a significant investment within this sector, likely supporting foundational or applied research. Comparable spending benchmarks would involve analyzing other large federal R&D grants and contracts awarded to research institutions and private companies in similar scientific domains.

Small Business Impact

The data indicates that small business participation (ss: false, sb: false) was not a primary set-aside consideration for this contract. This suggests the contract was likely awarded based on specialized capabilities and technical expertise, where large, established research organizations are often better positioned. There is no explicit information on subcontracting plans, but for a contract of this nature, it's possible that specialized services might be subcontracted, potentially to small businesses, though this is not guaranteed.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Health and Human Services, specifically the National Institutes of Health (NIH). Mechanisms likely include regular progress reports, technical reviews, financial audits, and potentially site visits. The Inspector General's office for HHS would have jurisdiction for investigating fraud, waste, or abuse. Transparency is typically managed through contract award databases and public reporting of research outcomes, though specific project details may be proprietary.

Related Government Programs

Department of Defense Research and Development Contracts
National Science Foundation Grants
Department of Energy Applied Research Programs
NASA Research Initiatives

Risk Flags

Cost Overrun Risk (CPFF)
Contractor Performance Monitoring
Scope Creep Management
Long-Term Project Viability

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $12.4 million to BATTELLE MEMORIAL INSTITUTE. See the official description on USAspending.

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 $12.4 million.

What is the period of performance?

Start: 2003-03-15. End: 2008-08-31.

What is Battelle Memorial Institute's track record with federal R&D contracts, particularly with NIH?

Battelle Memorial Institute has a substantial history of securing and performing on federal research and development contracts across various agencies, including the Department of Defense, Department of Energy, and the Department of Health and Human Services. Their experience often spans complex scientific and engineering challenges. For NIH specifically, Battelle has been involved in projects related to biomedical research, health technology, and life sciences. A review of their past performance on similar contracts would indicate their ability to meet technical requirements, manage budgets, and adhere to timelines. Their long-standing presence suggests a capacity to handle large-scale, multi-year R&D endeavors, though specific performance metrics on individual contracts would require deeper investigation.

How does the $124 million contract value compare to similar R&D investments by NIH in physical, engineering, and life sciences?

The $124 million award is a significant sum, placing it among the larger R&D contracts awarded by NIH. NIH's total budget for research is in the tens of billions annually, with substantial portions allocated to extramural research grants and contracts. Contracts of this magnitude are typically reserved for large-scale, multi-disciplinary projects requiring extensive resources and specialized expertise, often awarded to major research institutions or consortia. To benchmark effectively, one would compare this contract's value against other large 'Research and Development in the Physical, Engineering, and Life Sciences' (NAICS 541710) awards made by NIH or other federal agencies over a similar timeframe. This comparison would reveal whether the investment is typical, high, or low relative to the scope and duration of the research.

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

The primary risk with a Cost Plus Fixed Fee (CPFF) contract, especially in R&D, is the potential for cost overruns. While the fixed fee provides the contractor with a guaranteed profit margin, the government bears the risk of all allowable costs. If the research proves more complex or time-consuming than initially estimated, costs can escalate significantly. This necessitates robust government oversight to ensure that all incurred costs are reasonable, allocable, and necessary for the project. Contractors may have less incentive to control costs compared to fixed-price contracts, as their fee is fixed regardless of the final cost. Effective management requires detailed cost tracking, regular audits, and clear communication to manage scope changes and prevent inefficiencies.

How does the 'full and open competition' award mechanism impact the potential effectiveness and cost of this R&D contract?

Awarding this R&D contract through 'full and open competition' is generally seen as a positive indicator for both effectiveness and cost. This mechanism allows any responsible source to submit a proposal, maximizing the pool of potential contractors and fostering a competitive environment. Competition typically drives innovation and encourages bidders to offer their best technical solutions and pricing to win the contract. For taxpayers, this process is more likely to result in a fair market price and a higher quality outcome, as multiple entities vie for the award. The effectiveness is enhanced as the agency can select the contractor with the most suitable capabilities and approach for the specific R&D objectives.

What are the implications of this contract being awarded to a single entity, Battelle Memorial Institute, for the broader R&D ecosystem?

Awarding a substantial contract like this to a single entity, even after full and open competition, concentrates significant R&D funding and activity within that organization. While Battelle Memorial Institute is a major research institution capable of handling such a scope, it means other potentially capable organizations did not receive this specific funding stream. This can influence the broader R&D ecosystem by directing talent and resources towards Battelle's chosen research areas. It also highlights the importance of ensuring that future solicitations remain open to diverse participants to foster a healthy and competitive research landscape, and that opportunities for collaboration or knowledge sharing are considered where appropriate.

What is the typical duration and funding cycle for large R&D contracts within the physical, engineering, and life sciences sector?

Large R&D contracts within the physical, engineering, and life sciences sector often have durations ranging from 3 to 5 years, sometimes with options for extensions. The funding cycle can be structured in various ways, including incrementally funded contracts where funds are allocated annually based on appropriations and performance, or contracts with a defined total amount awarded upfront but disbursed over the performance period. The $124 million value over approximately five years suggests a substantial, long-term commitment to a specific research agenda. This duration allows for in-depth research, development of complex technologies, and the accumulation of meaningful scientific data, which is often necessary for significant breakthroughs in these fields.

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: 1

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Address: 505 KING AVE, COLUMBUS, OH, 90

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $43,939,244

Exercised Options: $57,437,138

Current Obligation: $12,423,327

Timeline