HHS awards $64M contract to Deloitte for CBER Systems Modernization, impacting FDA operations

Contract Overview

Contract Amount: $64,256,854 ($64.3M)

Contractor: Deloitte Consulting LLP

Awarding Agency: Department of Health and Human Services

Start Date: 2024-07-12

End Date: 2026-08-27

Contract Duration: 776 days

Daily Burn Rate: $82.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: LABOR HOURS

Sector: Other

Official Description: CBER SYSTEMS OPERATIONS AND MODERNIZATION (CSOM)

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22209

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $64.3 million to DELOITTE CONSULTING LLP for work described as: CBER SYSTEMS OPERATIONS AND MODERNIZATION (CSOM) Key points: 1. Contract aims to modernize critical systems for the Center for Biologics Evaluation and Research (CBER). 2. Deloitte Consulting LLP, a large established firm, secured this significant award. 3. The contract duration extends over two years, indicating a substantial project scope. 4. Performance is located in Virginia, a hub for federal contracting. 5. The award falls under administrative management and general management consulting services. 6. This contract is part of broader efforts to enhance regulatory review and public health. 7. The use of 'Delivery Order' suggests it might be part of a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle.

Value Assessment

Rating: good

The contract value of $64.26 million over approximately two years suggests a significant investment in CBER's operational capabilities. Benchmarking this against similar IT modernization or consulting contracts within HHS or FDA requires detailed analysis of scope and deliverables. However, the award to a major consulting firm like Deloitte for a critical function like CBER operations implies a focus on expertise and established performance. Without specific comparable contract data, a precise value-for-money assessment is challenging, but the scale indicates a substantial need and commitment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple qualified vendors had the opportunity to bid. This competitive process is generally expected to yield fair market pricing and encourage innovative solutions. The fact that it was competed fully suggests that the government sought the best value from the widest possible pool of offerors, rather than restricting it to specific vendors or contract vehicles.

Taxpayer Impact: Full and open competition is favorable for taxpayers as it drives down costs through market forces and ensures that the government is not overpaying for services. It maximizes the potential for receiving high-quality services at competitive rates.

Public Impact

The primary beneficiaries are the FDA's Center for Biologics Evaluation and Research (CBER), enabling more efficient and modern operations. The contract will deliver modernized IT systems and administrative management consulting services crucial for regulatory review of biologics. The geographic impact is centered in Virginia, where the work will be performed. This contract supports a specialized workforce within the consulting sector and potentially impacts federal employees involved in CBER's IT and operational functions.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in complex IT modernization projects.
Dependence on a single large contractor for critical operational systems.
Ensuring knowledge transfer and long-term sustainment post-contract.

Positive Signals

Awarded through full and open competition, suggesting competitive pricing.
Contracting with a reputable firm with extensive experience in government IT and consulting.
Focus on modernizing critical infrastructure for a vital public health agency.

Sector Analysis

This contract falls within the Management and Consulting Services sector, specifically focusing on administrative and general management consulting. The IT modernization aspect also places it within the broader federal IT services market. The federal government is a significant consumer of these services, with substantial annual spending on IT modernization and management consulting to improve efficiency and effectiveness across agencies. This contract represents a portion of the FDA's investment in maintaining and upgrading its operational technology infrastructure.

Small Business Impact

As the contract was awarded to Deloitte Consulting LLP, a large business, there is no direct small business set-aside. However, the contract may include subcontracting opportunities for small businesses, depending on Deloitte's subcontracting plan. The scale of the project could offer significant subcontracting potential for specialized IT or consulting services, contributing to the small business ecosystem if actively pursued by the prime contractor.

Oversight & Accountability

Oversight will likely be managed by the Food and Drug Administration (FDA) contracting officers and program managers responsible for CBER operations. Transparency is expected through standard federal procurement reporting mechanisms. Accountability measures will be embedded in the contract's performance work statement, with deliverables, milestones, and quality standards subject to review and acceptance. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse related to the contract.

Related Government Programs

FDA IT Modernization Initiatives
HHS Management and Consulting Services
Center for Biologics Evaluation and Research (CBER) Operations
Federal IT Services Procurement
Administrative Management Consulting

Risk Flags

Potential for extended performance period impacting long-term budget planning.
Reliance on a single large vendor for critical system modernization.
Complexity of integrating new systems with existing FDA infrastructure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $64.3 million to DELOITTE CONSULTING LLP. CBER SYSTEMS OPERATIONS AND MODERNIZATION (CSOM)

Who is the contractor on this award?

The obligated recipient is DELOITTE CONSULTING LLP.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Food and Drug Administration).

What is the total obligated amount?

The obligated amount is $64.3 million.

What is the period of performance?

Start: 2024-07-12. End: 2026-08-27.

What is the historical spending pattern for CBER IT modernization and management consulting services?

Analyzing historical spending for CBER's IT modernization and management consulting reveals trends in investment towards enhancing operational efficiency and regulatory capabilities. Prior to this $64.26 million award, CBER likely engaged in various contracts for system upgrades, maintenance, and consulting support. Understanding the aggregate spending over the past 5-10 years would provide context on the scale and continuity of these investments. For instance, if previous spending was significantly lower, this contract represents a substantial increase, potentially indicating a major overhaul or new strategic direction. Conversely, if historical spending was consistently high, this award might represent a continuation or expansion of ongoing modernization efforts. Data on specific prior contracts, their values, and durations would be crucial for a comprehensive trend analysis and to assess if this current award aligns with or deviates from established spending patterns.

How does the awarded amount compare to similar IT modernization contracts within the FDA or HHS?

The $64.26 million award for CBER Systems Operations and Modernization (CSOM) needs to be benchmarked against comparable IT modernization contracts within the FDA and the broader Department of Health and Human Services (HHS). Similar contracts might include those for upgrading electronic health record systems, enhancing data analytics platforms, or modernizing regulatory submission portals. The duration of the contract (approximately two years) is also a key factor in comparison. If other large-scale IT modernization efforts within these agencies typically range from $50 million to $100 million over similar periods, then this award appears to be within a common range. However, if comparable projects are significantly smaller or larger, it could indicate unique complexities, scope, or strategic priorities associated with the CBER modernization. A detailed analysis would involve examining the specific objectives, deliverables, and contract types of other relevant awards.

What are the key performance indicators (KPIs) and success metrics for this contract?

The key performance indicators (KPIs) and success metrics for the CBER Systems Operations and Modernization (CSOM) contract are critical for evaluating its effectiveness and ensuring value for money. While not explicitly detailed in the provided data, typical KPIs for such IT modernization and consulting projects include system uptime and availability, reduction in processing times for key CBER functions, successful migration of data to new platforms, user adoption rates of new systems, and achievement of specific regulatory compliance or efficiency targets. Performance will likely be measured against a detailed Performance Work Statement (PWS) which outlines specific deliverables, timelines, and quality standards. Regular progress reviews, system audits, and user feedback mechanisms would be employed to monitor performance against these metrics. The ultimate success will be measured by the extent to which the modernized systems improve CBER's ability to perform its mission effectively and efficiently.

What is Deloitte Consulting LLP's track record with similar federal IT modernization contracts?

Deloitte Consulting LLP has a substantial track record with federal IT modernization contracts across various agencies, including HHS and FDA. They are a major player in the government contracting space, known for undertaking large-scale digital transformation, cloud migration, and system integration projects. Their experience often spans complex environments requiring deep technical expertise and robust program management. For instance, Deloitte has been involved in significant health IT initiatives, data analytics modernization, and cybersecurity enhancements for federal clients. Assessing their specific performance on past FDA or HHS IT modernization contracts, particularly those involving regulatory systems or critical operational platforms, would provide direct insight into their capabilities and reliability for the CBER CSOM project. Past performance evaluations and contract awards data would be key resources for this assessment.

What are the potential risks associated with this contract, and how are they being mitigated?

Potential risks associated with this $64.26 million CBER Systems Operations and Modernization (CSOM) contract are typical of large-scale IT projects. These include technical risks such as integration challenges with legacy systems, cybersecurity vulnerabilities, and potential delays in development or deployment. Programmatic risks might involve scope creep, budget overruns, contractor performance issues, or difficulties in user adoption. Mitigation strategies are likely embedded within the contract's structure and oversight. This includes a detailed Performance Work Statement (PWS) with clear deliverables and milestones, robust project management by both the contractor (Deloitte) and the government (FDA), regular progress reviews, and potentially phased deployments to identify and address issues early. The full and open competition award also suggests a vetting process that considered contractor capabilities and risk management plans. Strong government oversight and clear communication channels are crucial for proactive risk mitigation.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Parent Company: Deloitte Financial Advisory Services LLP

Address: 1919 N LYNN ST, ARLINGTON, VA, 22209

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $64,816,035

Exercised Options: $64,256,854

Current Obligation: $64,256,854

Actual Outlays: $44,966,572

Subaward Activity

Number of Subawards: 7

Total Subaward Amount: $6,811,011

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 47QRAA18D001P

IDV Type: FSS

Timeline