NIH awards $530K for BD Flow Cytometers & Lasers, raising questions about competition and value

Contract Overview

Contract Amount: $530,113 ($530.1K)

Contractor: Becton, Dickinson and Company

Awarding Agency: Department of Health and Human Services

Start Date: 2023-04-01

End Date: 2027-03-31

Contract Duration: 1,460 days

Daily Burn Rate: $363/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: SERVICE AGREEMENT FOR BD FLOW CYTOMETERS & LASERS -BASE PLUS FOUR OPTION YEARS

Place of Performance

Location: SAN JOSE, SANTA CLARA County, CALIFORNIA, 95131

State: California Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $530,112.96 to BECTON, DICKINSON AND COMPANY for work described as: SERVICE AGREEMENT FOR BD FLOW CYTOMETERS & LASERS -BASE PLUS FOUR OPTION YEARS Key points: 1. The contract's value, while not exceptionally large, warrants scrutiny due to the lack of competitive bidding. 2. The sole-source nature of this award limits price discovery and potentially increases costs for taxpayers. 3. Performance risks are moderate, given the specialized nature of the equipment and the contractor's likely expertise. 4. This spending falls within the broader category of medical equipment maintenance and support. 5. The contract duration of four option years suggests a need for ongoing service and support for critical NIH research infrastructure.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without competitive bids. The $530,112.96 awarded over five years for maintenance and repair of specialized equipment like flow cytometers and lasers is difficult to assess against market rates. However, the absence of competition suggests potential for inflated pricing compared to what might be achieved through a more open bidding process. The firm-fixed-price structure offers some cost certainty, but the overall value proposition is weakened by the lack of competitive pressure.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This approach is typically used when only one responsible source can provide the required supplies or services. The lack of competition means that multiple vendors were not given the opportunity to bid, which can limit price discovery and potentially lead to higher costs for the government. The rationale for this sole-source award, if documented, would be crucial for understanding why other vendors were excluded.

Taxpayer Impact: Sole-source awards mean taxpayers may not be getting the best possible price, as there was no opportunity for multiple vendors to compete and offer lower bids. This can lead to less efficient use of federal funds.

Public Impact

Researchers at the National Institutes of Health (NIH) benefit from the continued operation and maintenance of critical flow cytometry equipment. The services delivered ensure the functionality of advanced scientific instruments essential for biomedical research. The geographic impact is concentrated at NIH facilities, likely in Bethesda, Maryland, where the equipment is housed. The contract supports specialized technical expertise for maintaining complex scientific equipment, potentially preserving skilled jobs within the contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Sole-source awards can reduce market pressure for innovation and efficiency.
Dependence on a single contractor for critical equipment maintenance poses a potential risk if the contractor's performance declines or they exit the market.

Positive Signals

The firm-fixed-price contract provides cost predictability for the agency.
The contractor, Becton, Dickinson and Company, is a known entity in the medical technology space, suggesting potential familiarity with the equipment.
The contract duration indicates a recognized need for ongoing support for essential research tools.

Sector Analysis

This contract falls within the broader healthcare and life sciences sector, specifically concerning the maintenance and support of specialized scientific instrumentation. The market for such equipment and associated services is often characterized by a few key manufacturers holding significant market share due to proprietary technology. Spending benchmarks for similar service agreements can vary widely based on the complexity and age of the equipment, but a sole-source award for maintenance often indicates a reliance on the original equipment manufacturer or a highly specialized service provider.

Small Business Impact

This contract does not appear to involve a small business set-aside, as indicated by the 'sb': false flag. There is no explicit mention of subcontracting requirements for small businesses. Therefore, the direct impact on the small business ecosystem from this specific award is likely minimal, unless the prime contractor voluntarily engages small businesses for support services not detailed in this contract.

Oversight & Accountability

Oversight for this contract would primarily fall under the National Institutes of Health (NIH) contracting officers and program managers. As a purchase order, it is a less formal instrument than a full-fledged contract but still requires diligent monitoring of performance and adherence to terms. Transparency is limited by the sole-source nature of the award. There is no specific mention of an Inspector General's jurisdiction for this particular award, though the HHS OIG generally oversees all HHS spending.

Related Government Programs

NIH Research Equipment Maintenance
Biomedical Instrumentation Services
Flow Cytometry Equipment Support
Medical Device Service Contracts

Risk Flags

Sole-source award
Lack of competition
Potential for inflated pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $530,112.96 to BECTON, DICKINSON AND COMPANY. SERVICE AGREEMENT FOR BD FLOW CYTOMETERS & LASERS -BASE PLUS FOUR OPTION YEARS

Who is the contractor on this award?

The obligated recipient is BECTON, DICKINSON AND COMPANY.

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 $530,112.96.

What is the period of performance?

Start: 2023-04-01. End: 2027-03-31.

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

The provided data indicates the contract was 'NOT COMPETED' and is a 'SOLE SOURCE'. Without further documentation, the specific justification remains unclear. Typically, sole-source awards are justified under specific circumstances outlined in federal acquisition regulations, such as when only one vendor possesses the necessary technical expertise, proprietary knowledge, or unique capabilities to meet the agency's requirements. For specialized equipment like BD Flow Cytometers & Lasers, the manufacturer often has unique knowledge for maintenance and repair. However, agencies are required to document and justify these sole-source determinations to ensure fair and efficient use of taxpayer funds. A review of the contract file or justification and approval (J&A) document would be necessary to ascertain the precise rationale.

How does the pricing of this contract compare to similar service agreements for flow cytometers and lasers?

Direct price comparison is difficult without access to competitive bidding data or publicly available pricing for similar service agreements. The $530,112.96 awarded over five years covers base plus four option years for 'SERVICE AGREEMENT FOR BD FLOW CYTOMETERS & LASERS'. The absence of competition inherently limits the ability to benchmark pricing effectively. If this were a competitive award, we could analyze the bids received to assess value. Given the sole-source nature, it's plausible that the pricing is at the higher end of the spectrum compared to what could be achieved through open competition. Further analysis would require access to market research reports or pricing data from comparable sole-source or competitively awarded maintenance contracts for similar equipment.

What are the potential risks associated with relying on a single contractor for maintenance of critical research equipment?

Relying on a single contractor, especially for specialized equipment like flow cytometers and lasers, presents several risks. Firstly, there's a risk of vendor lock-in, where the agency becomes heavily dependent on the contractor's services, potentially limiting flexibility and negotiation power. Secondly, if the contractor's performance deteriorates, or if they experience financial instability or decide to discontinue the service, the agency could face significant disruptions to its research operations. Thirdly, without competitive pressure, the contractor may have less incentive to innovate or improve service quality. Finally, the sole-source nature means the government may be paying a premium for these services compared to a competitive market.

What is the track record of Becton, Dickinson and Company (BD) in providing similar service agreements to federal agencies?

Becton, Dickinson and Company (BD) is a well-established global medical technology company with a significant presence in providing instruments, reagents, and services for research and diagnostics, including flow cytometry. While specific details of their past federal contract performance are not provided here, BD is known to hold numerous contracts across various federal agencies for its products and related services. Their long-standing presence in the industry suggests a level of experience and capability. However, a comprehensive assessment of their track record would involve reviewing past performance evaluations, any reported issues or disputes on previous federal contracts, and their overall reputation within the scientific and healthcare communities.

How does this contract align with overall federal spending trends in biomedical research equipment maintenance?

This contract aligns with broader federal spending trends that support critical research infrastructure. Agencies like the NIH consistently invest in maintaining and upgrading sophisticated equipment necessary for scientific advancement. Spending on service agreements for complex instruments like flow cytometers is a necessary component of research budgets. While the specific dollar amount ($530K) is modest in the context of the entire federal budget, it represents a typical expenditure for ensuring the operational readiness of specialized research tools. Trends in this area often reflect the pace of technological advancement, the need for specialized maintenance expertise, and the increasing reliance on high-throughput research methodologies.

Industry Classification

NAICS: Other Services (except Public Administration) › Electronic and Precision Equipment Repair and Maintenance › Electronic and Precision Equipment Repair and Maintenance

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: NOI-NIAID-2158902

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Becton, Dickinson and CO

Address: 2350 QUME DR, SAN JOSE, CA, 95131

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: $927,698

Exercised Options: $530,113

Current Obligation: $530,113

Actual Outlays: $397,585

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline