HHS Awards $3.7M for Cepheid GeneXpert Reagents to Support IHS Diagnostics

Contract Overview

Contract Amount: $3,694,462 ($3.7M)

Contractor: Cepheid

Awarding Agency: Department of Health and Human Services

Start Date: 2022-02-24

End Date: 2027-02-28

Contract Duration: 1,830 days

Daily Burn Rate: $2.0K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: ZSU CEPHEID GENEXPERT REQUIRES GROUP B REAGENTS KITS

Place of Performance

Location: ZUNI, MCKINLEY County, NEW MEXICO, 87327

State: New Mexico Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $3.7 million to CEPHEID for work described as: ZSU CEPHEID GENEXPERT REQUIRES GROUP B REAGENTS KITS Key points: 1. The contract focuses on essential reagents for diagnostic testing, a critical component of healthcare delivery. 2. Competition was limited, with the award made under Simplified Acquisition Procedures, suggesting a focus on smaller value procurements. 3. Potential risks include reliance on a single supplier for specific reagents and the long-term availability of necessary supplies. 4. The healthcare sector, particularly diagnostic services, is a consistent area of federal spending.

Value Assessment

Rating: good

The contract value of $3.7M over five years appears reasonable for specialized diagnostic reagents. Benchmarking against similar contracts for in-vitro diagnostic substances would provide further validation, but the pricing seems aligned with the sector's needs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was competed under Simplified Acquisition Procedures (SAP), indicating a limited competition approach likely due to the contract value threshold. This method may not always yield the lowest possible price compared to full and open competition.

Taxpayer Impact: Taxpayer funds are being used to ensure the availability of critical diagnostic supplies for the Indian Health Service, supporting public health initiatives.

Public Impact

Ensures continued access to vital diagnostic testing for patients served by the Indian Health Service. Supports the operational readiness of healthcare facilities relying on GeneXpert technology. Contributes to the supply chain stability for essential medical consumables. Potential impact on patient care if reagent supply is disrupted.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may lead to suboptimal pricing.
Potential for supply chain disruptions if Cepheid faces production issues.
Long-term reliance on specific reagents could limit future flexibility.

Positive Signals

Ensures availability of critical diagnostic tools.
Supports a key healthcare provider (IHS).
Fixed-price contract provides cost certainty.

Sector Analysis

This contract falls within the healthcare sector, specifically in the manufacturing and supply of in-vitro diagnostic substances. Federal spending in this area is substantial, driven by the need for advanced medical technologies and consumables across various agencies.

Small Business Impact

The data does not indicate any specific set-asides for small businesses. Given the nature of specialized diagnostic reagents, larger manufacturers are often involved, but opportunities for small businesses in distribution or related services may exist.

Oversight & Accountability

The contract is managed by the Department of Health and Human Services (Indian Health Service). Oversight would focus on ensuring timely delivery, quality of reagents, and adherence to the contract terms to maintain diagnostic capabilities.

Related Government Programs

In-Vitro Diagnostic Substance Manufacturing
Department of Health and Human Services Contracting
Indian Health Service Programs

Risk Flags

Limited competition.
Potential supply chain dependency.
Long-term contract duration.
Reliance on specific technology (GeneXpert).

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $3.7 million to CEPHEID. ZSU CEPHEID GENEXPERT REQUIRES GROUP B REAGENTS KITS

Who is the contractor on this award?

The obligated recipient is CEPHEID.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Indian Health Service).

What is the total obligated amount?

The obligated amount is $3.7 million.

What is the period of performance?

Start: 2022-02-24. End: 2027-02-28.

What is the specific breakdown of reagent types and quantities required under this contract, and how does this align with the IHS's projected diagnostic needs?

The provided data does not detail the specific types or quantities of reagents. A thorough analysis would require reviewing the contract's statement of work or delivery orders. Understanding the IHS's projected diagnostic needs is crucial to assess if this contract adequately covers anticipated demand and avoids potential shortages or overstocking.

What measures are in place to mitigate risks associated with sole-source reliance on Cepheid for these critical reagents, particularly concerning price escalations or supply chain vulnerabilities?

Given the limited competition, the primary mitigation strategy would be robust contract management by HHS, including regular performance reviews and price reasonableness checks. Exploring alternative suppliers for future contracts or negotiating long-term supply agreements with built-in price protections could also be considered to address potential vulnerabilities.

How does the utilization of these GeneXpert reagents by the IHS contribute to improved patient outcomes and diagnostic efficiency compared to alternative testing methods?

The GeneXpert system is known for its rapid, point-of-care diagnostic capabilities, which can significantly reduce turnaround times for critical tests. This efficiency can lead to faster treatment decisions, potentially improving patient outcomes, especially in remote or underserved areas served by the IHS. Further analysis would involve comparing specific diagnostic metrics.

Industry Classification

NAICS: Manufacturing › Pharmaceutical and Medicine Manufacturing › In-Vitro Diagnostic Substance Manufacturing

Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 75H70722Q00020

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Danaher Corporation

Address: 904 CARIBBEAN DR, SUNNYVALE, CA, 94089

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: $3,694,462

Exercised Options: $3,694,462

Current Obligation: $3,694,462

Actual Outlays: $1,162,255

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline