HHS awards $4.9M contract for comprehensive analytical chemistry services to Bureau Veritas North America Inc

Contract Overview

Contract Amount: $4,930,554 ($4.9M)

Contractor: Bureau Veritas North America Inc

Awarding Agency: Department of Health and Human Services

Start Date: 2021-09-30

End Date: 2027-01-31

Contract Duration: 1,949 days

Daily Burn Rate: $2.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS AWARD FEE

Sector: Healthcare

Official Description: COMPREHENSIVE ANALYTICAL CHEMISTRY SERVICES (CACS)

Place of Performance

Location: NOVI, OAKLAND County, MICHIGAN, 48375

State: Michigan Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $4.9 million to BUREAU VERITAS NORTH AMERICA INC for work described as: COMPREHENSIVE ANALYTICAL CHEMISTRY SERVICES (CACS) Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Award Fee, which incentivizes performance but can lead to higher costs. 3. The duration of the contract is over 1900 days, indicating a long-term need for these services. 4. The contract is managed by the Centers for Disease Control and Prevention (CDC), a key agency within HHS. 5. The North American Industry Classification System (NAICS) code 541380 points to specialized testing laboratory services. 6. The contract value of $4.9M is relatively modest for federal contracts of this duration and scope.

Value Assessment

Rating: good

The contract value of $4.9M over approximately 5.4 years averages to roughly $900K annually. Benchmarking this against similar analytical chemistry service contracts is difficult without more specific service details. However, the Cost Plus Award Fee structure allows for flexibility in payment based on performance, which can be a good value if the award fees are tied to clear, measurable outcomes. The pricing structure needs careful monitoring to ensure that costs remain reasonable and that award fees are justified by exceptional performance.

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 a bid. The presence of two bids suggests a moderate level of competition for this specific requirement. While two bidders is better than a sole source, a higher number of bidders typically leads to more robust price discovery and potentially lower prices for the government.

Taxpayer Impact: The full and open competition, even with two bidders, provides some assurance that the government is receiving a fair price. However, taxpayers may have benefited from even greater savings if more companies had participated in the bidding process.

Public Impact

The Centers for Disease Control and Prevention (CDC) will benefit from these services, likely supporting public health research and safety initiatives. Services delivered will include comprehensive analytical chemistry testing, crucial for disease surveillance, environmental health, and product safety. The geographic impact is likely national, given the CDC's mission, though specific lab locations are not detailed. The contract supports specialized scientific roles within the analytical chemistry field.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee contracts can sometimes lead to cost overruns if not managed tightly.
Limited competition (two bidders) may not have resulted in the lowest possible price for taxpayers.
The long contract duration requires ongoing oversight to ensure continued value and relevance.

Positive Signals

Awarded through full and open competition, ensuring a fair process.
The Cost Plus Award Fee structure incentivizes high performance from the contractor.
The contract supports critical public health functions of the CDC.

Sector Analysis

The analytical chemistry services sector is vital for numerous government functions, including public health, environmental monitoring, and regulatory compliance. This contract falls under the broader professional, scientific, and technical services industry. The NAICS code 541380 specifically covers testing laboratories and services. Spending in this area is consistent with the government's need for specialized scientific expertise to support its missions, particularly within agencies like the CDC.

Small Business Impact

There is no indication that this contract included a small business set-aside. Bureau Veritas North America Inc. is a large corporation. Subcontracting opportunities for small businesses are not explicitly detailed in the provided data, but large prime contractors often utilize small businesses for specialized support services.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officers and program managers within the Centers for Disease Control and Prevention (CDC). The Cost Plus Award Fee structure necessitates robust performance monitoring and evaluation to justify any award fees. Transparency is generally maintained through contract databases, but specific performance metrics and award fee determinations are typically internal to the agency.

Related Government Programs

CDC Laboratory Services
Public Health Analytical Support
Environmental Testing Contracts
Scientific Research and Development Services

Risk Flags

Limited competition may impact price.
CPAF structure requires robust oversight.
Potential for technology obsolescence over contract duration.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $4.9 million to BUREAU VERITAS NORTH AMERICA INC. COMPREHENSIVE ANALYTICAL CHEMISTRY SERVICES (CACS)

Who is the contractor on this award?

The obligated recipient is BUREAU VERITAS NORTH AMERICA INC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Centers for Disease Control and Prevention).

What is the total obligated amount?

The obligated amount is $4.9 million.

What is the period of performance?

Start: 2021-09-30. End: 2027-01-31.

What is the specific nature of the analytical chemistry services required by the CDC under this contract?

The contract, identified as COMPREHENSIVE ANALYTICAL CHEMISTRY SERVICES (CACS), is awarded to Bureau Veritas North America Inc. by the Department of Health and Human Services (HHS) through the Centers for Disease Control and Prevention (CDC). While the specific analytical chemistry services are not detailed in the provided data, the NAICS code 541380 (Testing Laboratories and Services) suggests a broad range of laboratory testing and analysis. This could encompass areas such as chemical composition analysis, contaminant detection, quality control testing, method development, and validation for various matrices (e.g., biological samples, environmental samples, manufactured products). Given the CDC's mission, these services likely support public health initiatives, disease surveillance, environmental health assessments, and potentially the safety and efficacy of regulated products.

How does the Cost Plus Award Fee (CPAF) structure typically function, and what are its implications for this contract?

A Cost Plus Award Fee (CPAF) contract is a type of cost-reimbursement contract where the contractor is reimbursed for all allowable costs incurred, plus a fee that consists of a fixed base amount and an award amount. The award amount is determined by the government based on the contractor's performance against pre-defined criteria. For this contract with Bureau Veritas, it means the government will pay for the costs incurred by the contractor to perform the analytical chemistry services, plus a fee. A significant portion of this fee is contingent upon the contractor meeting or exceeding specific performance objectives. This structure incentivizes the contractor to perform exceptionally well to maximize their fee. However, it also requires robust government oversight to objectively assess performance and fairly determine the award fee, and it can potentially lead to higher overall costs compared to fixed-price contracts if performance is consistently high.

What does the limited competition (two bidders) suggest about the market for these specialized analytical chemistry services?

The fact that only two bids were received for this contract, despite being awarded under full and open competition, suggests a potentially concentrated market for these specific comprehensive analytical chemistry services. This could be due to several factors: the highly specialized nature of the required testing, the significant technical expertise and equipment necessary, stringent qualification requirements set by the CDC, or perhaps the contract's geographic scope or duration. While full and open competition was utilized, a lower number of bidders generally implies less price pressure. Taxpayers might have benefited from more competitive pricing if a larger pool of qualified vendors had submitted proposals. It also raises a flag for potential future procurements to assess if market barriers exist or if outreach efforts could be enhanced to attract more bidders.

What is the historical spending pattern for similar analytical chemistry services by the CDC or HHS?

Analyzing historical spending patterns for similar analytical chemistry services by the CDC or HHS requires access to detailed federal procurement databases beyond the provided summary data. However, it is reasonable to assume that the CDC, as a leading public health agency, consistently requires a range of analytical testing services to support its diverse missions, including disease outbreak investigations, environmental health monitoring, and laboratory diagnostics. Spending in this area would likely fluctuate based on specific public health emergencies, research priorities, and the lifecycle of various testing programs. Benchmarking this $4.9M contract against prior similar awards would provide context on whether the current award represents an increase, decrease, or stable level of investment in these critical services. Without historical data, it's challenging to definitively assess trends.

What are the potential risks associated with a long-duration contract (over 1900 days) for analytical chemistry services?

Long-duration contracts, such as this 1949-day (approximately 5.4 years) award, carry several potential risks. Firstly, the scientific and technological landscape for analytical chemistry can evolve rapidly. There's a risk that the services or methodologies specified at the contract's outset may become outdated or less efficient over its lifespan, potentially diminishing the value proposition. Secondly, maintaining consistent quality and performance from a contractor over an extended period requires diligent oversight. Performance can degrade, or unforeseen issues can arise. Thirdly, market prices for materials, labor, and equipment can fluctuate significantly over several years, potentially impacting the cost-effectiveness of a Cost Plus Award Fee structure if not managed carefully. Finally, long contracts can reduce flexibility for the agency to adapt to changing needs or to incorporate new, potentially superior, technologies or service providers that emerge during the contract term.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Testing Laboratories and Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 75D301-21-R-71818

Offers Received: 2

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 22345 ROETHEL DR, NOVI, MI, 48375

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

Financial Breakdown

Contract Ceiling: $6,443,766

Exercised Options: $5,399,606

Current Obligation: $4,930,554

Actual Outlays: $2,752,523

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline