HHS awards $39.2M contract for Pralidoxime Chloride Protopam to Baxter Healthcare Corporation

Contract Overview

Contract Amount: $39,231,414 ($39.2M)

Contractor: Baxter Healthcare Corporation

Awarding Agency: Department of Health and Human Services

Start Date: 2021-09-30

End Date: 2025-09-29

Contract Duration: 1,460 days

Daily Burn Rate: $26.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: PRALIDOXIME CHLORIDE PROTOPAM

Place of Performance

Location: DEERFIELD, LAKE County, ILLINOIS, 60015

State: Illinois Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $39.2 million to BAXTER HEALTHCARE CORPORATION for work described as: PRALIDOXIME CHLORIDE PROTOPAM Key points: 1. Contract awarded for a critical pharmaceutical preparation, suggesting a focus on national health security or emergency preparedness. 2. The fixed-price contract structure aims to provide cost certainty for the government. 3. The duration of the contract (1460 days) indicates a long-term need for the product. 4. The award to a single, established corporation may streamline delivery but warrants scrutiny for potential price efficiencies. 5. The specific product, Pralidoxime Chloride Protopam, is often associated with organophosphate poisoning treatment, highlighting its strategic importance. 6. The contract's value, while significant, needs to be benchmarked against similar procurements for pharmaceutical countermeasures.

Value Assessment

Rating: good

The contract value of $39.2 million over approximately four years for Pralidoxime Chloride Protopam appears reasonable given the product's critical nature and the long-term supply requirement. Benchmarking against similar pharmaceutical procurements for strategic stockpiles or emergency response would provide further context. The firm fixed-price nature of the contract helps manage cost fluctuations, but the absence of detailed cost breakdowns makes a precise value-for-money assessment challenging without comparative data.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. With 3 bidders, the competition level suggests a moderate degree of market interest. This process is generally favorable for price discovery and ensuring the government receives competitive pricing. However, the specific details of the bidding process and the spread of the bids are not provided, which would offer deeper insights into the effectiveness of the competition.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices through market forces. The presence of multiple bidders suggests that taxpayer funds are being used efficiently to secure necessary pharmaceutical supplies.

Public Impact

The primary beneficiaries are individuals requiring treatment for organophosphate poisoning, potentially including military personnel, first responders, and the general public. The contract ensures the availability of Pralidoxime Chloride Protopam, a vital antidote, for the nation's strategic stockpiles. The geographic impact is national, ensuring availability across the United States through the Department of Health and Human Services. Workforce implications are likely minimal directly from this contract, but it supports the pharmaceutical manufacturing sector and associated supply chains.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price increases in future contract renewals if competition diminishes.
Reliance on a single supplier for a critical medical countermeasure could pose supply chain risks.
Limited transparency into the specific cost components of the pharmaceutical preparation.

Positive Signals

Awarded through full and open competition, indicating a competitive bidding process.
Firm fixed-price contract provides cost certainty for the government.
Long-term contract duration suggests a sustained commitment to national health security needs.
Award to a known entity in the pharmaceutical sector implies established manufacturing capabilities.

Sector Analysis

This contract falls within the Pharmaceutical Preparation Manufacturing sector, a critical component of the broader healthcare and life sciences industry. The market for medical countermeasures and emergency pharmaceuticals is often characterized by government procurement due to the specialized nature and strategic importance of these products. Spending in this area is driven by national security, public health preparedness, and the need for reliable access to essential medicines. Comparable spending benchmarks would typically involve other contracts for antidotes, vaccines, or critical care medications procured by agencies like HHS or the Department of Defense.

Small Business Impact

The data indicates this contract was not set aside for small businesses, nor does it explicitly mention subcontracting goals for small businesses. The award to Baxter Healthcare Corporation, a large pharmaceutical company, suggests that the primary focus was on established manufacturing capacity and product availability rather than small business participation. Further analysis would be needed to determine if any subcontracting opportunities exist within Baxter's supply chain for small businesses.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Health and Human Services (HHS), specifically the Office of Assistant Secretary for Preparedness and Response (ASPR). Mechanisms likely include regular performance reviews, quality control checks, and financial audits to ensure compliance with contract terms. Transparency is facilitated through contract award databases, but detailed operational oversight specifics are typically internal. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Strategic National Stockpile
Medical Countermeasures Stockpile
Pharmaceutical Procurement
Emergency Preparedness and Response Contracts
Antidote and Toxin Treatment Contracts

Risk Flags

Potential for single-source reliance in future if competition dwindles.
Lack of detailed cost breakdown for value assessment.
Dependence on a specific pharmaceutical for a critical health need.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $39.2 million to BAXTER HEALTHCARE CORPORATION. PRALIDOXIME CHLORIDE PROTOPAM

Who is the contractor on this award?

The obligated recipient is BAXTER HEALTHCARE CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Office of Assistant Secretary for Preparedness and Response).

What is the total obligated amount?

The obligated amount is $39.2 million.

What is the period of performance?

Start: 2021-09-30. End: 2025-09-29.

What is the historical spending pattern for Pralidoxime Chloride Protopam by the Department of Health and Human Services?

Historical spending data for Pralidoxime Chloride Protopam by HHS is not directly available in the provided data snippet. However, the current award of $39.2 million suggests a significant, long-term investment in this specific pharmaceutical. To understand historical patterns, one would need to access HHS procurement databases or reports covering previous contract awards for this item, looking at award amounts, contract durations, and awarded vendors over time. This would reveal if this is a new procurement, a renewal of a previous contract, or an expansion of existing supply.

How does the per-unit cost of Pralidoxime Chloride Protopam under this contract compare to market rates or similar government contracts?

The provided data does not include per-unit cost information, making a direct comparison to market rates or similar government contracts impossible. The contract is a firm fixed price for a total value of $39.2 million over 1460 days. To assess per-unit cost, the total quantity of Pralidoxime Chloride Protopam to be delivered would be required. Without this quantity, or without access to benchmark data for similar pharmaceutical procurements (e.g., other antidotes or emergency medications), a meaningful per-unit cost analysis cannot be performed. This is a key area for further investigation to determine true value for money.

What is Baxter Healthcare Corporation's track record with similar government contracts, particularly in emergency preparedness or pharmaceutical stockpiling?

Baxter Healthcare Corporation is a major global healthcare company with a significant history of supplying pharmaceuticals and medical products to government agencies, including the U.S. government. While specific details of their past contracts for Pralidoxime Chloride Protopam or similar emergency preparedness items are not in this data, their established presence in the pharmaceutical industry suggests they have experience navigating government procurement processes and meeting stringent regulatory and supply chain requirements. A deeper dive into federal procurement databases (like FPDS or SAM.gov) would reveal the scope and performance of their prior contracts with HHS, DoD, and other relevant agencies.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

Primary risks include potential supply chain disruptions (e.g., manufacturing issues, raw material shortages), price volatility if future contracts face less competition, and the risk of product obsolescence or the development of superior alternatives. Mitigation strategies likely involve the firm fixed-price structure to lock in costs, the full and open competition process to encourage market responsiveness, and the long-term nature of the contract which implies a sustained demand and commitment from the government. HHS's oversight mechanisms, including performance monitoring and quality assurance, also serve as risk mitigation tools.

How does the awarded amount of $39.2 million compare to the total market size for Pralidoxime Chloride Protopam or similar medical countermeasures?

The provided data does not offer information on the total market size for Pralidoxime Chloride Protopam or similar medical countermeasures. This contract represents a significant portion of the government's procurement for this specific item, likely for strategic stockpiling purposes. To compare this award to the overall market, one would need market research reports or industry analyses that estimate the total global or national demand and value of this pharmaceutical category. Without such data, it's difficult to ascertain if this contract represents a large or small fraction of the total available market.

Industry Classification

NAICS: Manufacturing › Pharmaceutical and Medicine Manufacturing › Pharmaceutical Preparation Manufacturing

Product/Service Code: SPECIAL INDUSTRY MACHINERY

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 75A50119Q00099

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1 BAXTER PKWY, DEERFIELD, IL, 60015

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $52,216,093

Exercised Options: $39,231,414

Current Obligation: $39,231,414

Actual Outlays: $39,231,413

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline