NIH awards $30M for reagents and diagnostic substances, with limited competition

Contract Overview

Contract Amount: $29,969 ($30.0K)

Contractor: Lonza Walkersville, Inc

Awarding Agency: Department of Health and Human Services

Start Date: 2020-06-19

End Date: 2026-05-02

Contract Duration: 2,143 days

Daily Burn Rate: $14/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: FOR REAGENTS SUPPLIES SUPPORT SERVICES.

Place of Performance

Location: WALKERSVILLE, FREDERICK County, MARYLAND, 21793

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $29,968.5 to LONZA WALKERSVILLE, INC for work described as: FOR REAGENTS SUPPLIES SUPPORT SERVICES. Key points: 1. Contract awarded via purchase order, indicating a streamlined acquisition process. 2. The contract duration of over 5 years suggests a long-term need for these supplies. 3. Limited competition raises questions about potential price efficiencies and value for money. 4. The award is for essential reagents and support services for health research. 5. The National Institutes of Health (NIH) is the primary agency overseeing this expenditure. 6. The contract is a firm-fixed-price type, providing cost certainty for the government.

Value Assessment

Rating: questionable

Benchmarking the value of this $30 million contract is challenging without specific per-unit cost data or comparisons to similar reagent supply contracts. The firm-fixed-price structure offers cost certainty, but the limited competition may have precluded achieving the best possible pricing. Further analysis would require understanding the specific types and quantities of reagents procured and comparing their costs against market rates or other government contracts for similar items. Without this granular data, it's difficult to definitively assess if the government received excellent value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor was solicited. This approach bypasses the standard competitive bidding process, which typically involves multiple vendors submitting proposals. While sole-source awards can be justified in specific circumstances (e.g., unique capabilities, urgent needs), they generally lead to less price competition and potentially higher costs for the government compared to fully competed contracts. The lack of multiple bidders means the government did not benefit from the price discovery mechanisms inherent in a competitive environment.

Taxpayer Impact: Sole-source awards mean taxpayers may not be getting the most competitive pricing available, as the government did not leverage multiple bids to drive down costs. This can result in higher overall spending for the same goods or services.

Public Impact

Researchers and scientists at the National Institutes of Health (NIH) will benefit from a consistent supply of essential reagents and diagnostic substances. The services delivered are critical for ongoing in-vitro diagnostic research and development. The geographic impact is primarily centered around NIH facilities, likely in Maryland. The contract supports the scientific workforce by ensuring they have the necessary materials for their work.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises concerns about potential overpayment and lack of cost-effectiveness.
Sole-source awards can reduce transparency and accountability in the procurement process.
The long contract duration without competitive re-evaluation might lead to complacency in service delivery or pricing.
Lack of detailed performance metrics in the provided data makes it hard to assess contractor performance.
The specific nature of 'reagents' is broad, making it difficult to benchmark without more detail.

Positive Signals

The firm-fixed-price contract provides budget certainty for the agency.
The contract ensures a continuous supply of critical materials for NIH research.
The award is to a known entity, Lonza Walkersville, Inc., potentially indicating a pre-existing relationship or specialized capability.
The contract duration suggests a stable and reliable partnership for essential supplies.

Sector Analysis

The market for reagents and diagnostic substances is a critical component of the broader healthcare and life sciences sector. This sector is characterized by innovation, specialized manufacturing, and significant government investment in research and development. Spending on such supplies by agencies like NIH is substantial, reflecting the ongoing need for materials to support scientific discovery and medical advancements. Comparable spending benchmarks would typically involve analyzing other large-scale reagent contracts awarded by federal health agencies or large research institutions.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a small business set-aside. The prime contractor, Lonza Walkersville, Inc., is likely a large business. Analysis of potential subcontracting opportunities for small businesses would require further investigation into the prime contractor's subcontracting plan, if one exists for this award.

Oversight & Accountability

Oversight for this contract would primarily fall under the National Institutes of Health (NIH), a division of the Department of Health and Human Services. As a purchase order, it may be subject to internal agency review and audit processes. The firm-fixed-price nature provides some cost control. Transparency could be enhanced by making detailed performance reports and justifications for the sole-source award publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

NIH Research Grants
Biomedical Research Supplies
Diagnostic Test Development
Federal Health Agency Procurement
Life Sciences R&D Contracts

Risk Flags

Limited Competition
Sole-Source Award
Lack of Detailed Performance Metrics
Potential for Non-Competitive Pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $29,968.5 to LONZA WALKERSVILLE, INC. FOR REAGENTS SUPPLIES SUPPORT SERVICES.

Who is the contractor on this award?

The obligated recipient is LONZA WALKERSVILLE, INC.

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 $29,968.5.

What is the period of performance?

Start: 2020-06-19. End: 2026-05-02.

What is the specific breakdown of reagents and support services covered under this contract?

The provided data offers a high-level description: 'FOR REAGENTS SUPPLIES SUPPORT SERVICES.' However, it lacks a detailed breakdown of the specific types, quantities, and catalog numbers of reagents, as well as the scope of support services included. This level of detail is crucial for accurate cost analysis, performance monitoring, and comparison with other market offerings. Without this granular information, it's difficult to ascertain the precise value or identify potential areas for cost savings. Further inquiry with the awarding agency (NIH) would be necessary to obtain a more comprehensive list of items and services.

How does the pricing of these reagents compare to similar contracts awarded by other federal agencies or large research institutions?

Direct price comparison is difficult without specific product identifiers and quantities. However, given the sole-source nature of this award, it is plausible that the pricing may not be as competitive as it could be under a fully competed scenario. To conduct a thorough comparison, one would need to identify comparable contracts for the same or similar reagents, noting the award dates, quantities, and contract types. Benchmarking against publicly available price lists from major scientific suppliers, adjusted for volume discounts and contract terms, would also provide insights. The absence of competitive bids suggests a potential risk of paying a premium.

What is the justification for awarding this contract on a sole-source basis?

The provided data simply states 'NOT COMPETED,' which typically implies a sole-source or limited competition award. Common justifications for sole-source awards include the unavailability of alternative sources, the existence of unique capabilities held by a single contractor, urgent and compelling needs where competition is not feasible, or when the contract is a follow-on to a previously competed effort where only one contractor can provide the necessary services or supplies. Without specific documentation from NIH detailing the justification, it is presumed that one of these criteria was met, though the lack of competition warrants scrutiny regarding potential missed opportunities for better value.

What are the performance metrics and evaluation criteria used to assess Lonza Walkersville, Inc.'s delivery of reagents and support services?

The provided summary data does not include specific performance metrics or evaluation criteria for this contract. Effective contract management relies on clearly defined metrics related to delivery timelines, product quality, service responsiveness, and adherence to specifications. The absence of this information in the summary makes it challenging to independently assess the contractor's performance. Typically, such details would be outlined in the contract's statement of work or performance work statement. The agency (NIH) would be responsible for monitoring these metrics and ensuring the contractor meets contractual obligations.

What has been the historical spending pattern for reagents and support services by the NIH in this category?

The provided data only pertains to a single award. To understand historical spending patterns, one would need to access broader federal procurement databases (like FPDS-NG) and query for similar contract actions awarded by the NIH or other relevant agencies over several fiscal years. Analyzing past spending would reveal trends in contract values, types of services procured, number of competitors, and average prices paid. This historical context is essential for identifying significant changes in spending, assessing the reasonableness of current expenditures, and understanding the agency's long-term reliance on such supplies.

Are there any known issues or past performance concerns related to Lonza Walkersville, Inc. for similar contracts?

The provided summary data does not contain information regarding the past performance record of Lonza Walkersville, Inc. Assessing contractor track record typically involves reviewing past performance evaluations, CPARS (Contractor Performance Assessment Reporting System) reports, and any documented disputes or claims. Without access to these records, it is impossible to determine if there are any significant past performance concerns. Agencies are generally required to consider past performance in source selection, especially for larger or more critical contracts, though the sole-source nature here might limit the extent of this consideration if specific justifications were met.

Industry Classification

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

Product/Service Code: INSTRUMENTS AND LABORATORY EQPT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 20-010707

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Herens Holdco S.À R.L.

Address: 8830 BIGGS FORD RD, WALKERSVILLE, MD, 21793

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: $29,969

Exercised Options: $29,969

Current Obligation: $29,969

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline