HHS Spends $10.5M on Thermo Electron Maintenance, Lacking Competition

Contract Overview

Contract Amount: $10,536,871 ($10.5M)

Contractor: Thermo Electron North America LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2007-09-01

End Date: 2012-05-31

Contract Duration: 1,734 days

Daily Burn Rate: $6.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: R&D

Official Description: THERMO ELECTRON MAINTENANCE

Place of Performance

Location: ATLANTA, DEKALB County, GEORGIA, 30341

State: Georgia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $10.5 million to THERMO ELECTRON NORTH AMERICA LLC for work described as: THERMO ELECTRON MAINTENANCE Key points: 1. Significant spending on a single vendor for essential maintenance. 2. Lack of competition raises concerns about potential overpricing. 3. Long contract duration (over 4 years) may limit flexibility. 4. The sector is analytical laboratory instrument manufacturing, critical for research.

Value Assessment

Rating: questionable

The total award amount of $10.5M over nearly 5 years for maintenance services is substantial. Without competitive bidding, it's difficult to ascertain if this price represents fair market value compared to similar maintenance contracts for analytical instruments.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source or limited competition award. This significantly reduces price discovery and potentially leads to higher costs for taxpayers.

Taxpayer Impact: The lack of competition likely results in higher costs than a competitively bid contract, impacting taxpayer value.

Public Impact

Essential maintenance for critical laboratory instruments ensures research continuity. Taxpayers may be overpaying due to the absence of competitive bidding. Long-term reliance on a single vendor could stifle innovation in maintenance services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Potential for overpricing
Long contract duration

Positive Signals

Ensures continuity of critical lab operations
Firm fixed price contract provides cost certainty

Sector Analysis

This contract falls within the Analytical Laboratory Instrument Manufacturing sector. Spending in this area is crucial for scientific research and public health initiatives, but competitive procurement is vital to ensure cost-effectiveness.

Small Business Impact

The data indicates this contract was not awarded to small businesses, as the 'sb' field is false. Further analysis would be needed to determine if small businesses could have provided these maintenance services.

Oversight & Accountability

The 'NOT COMPETED' status suggests potential oversight gaps. Agencies should justify sole-source awards and explore competitive options to ensure best value for taxpayer dollars.

Related Government Programs

Analytical Laboratory Instrument Manufacturing
Department of Health and Human Services Contracting
Centers for Disease Control and Prevention Programs

Risk Flags

Lack of competition
Potential for cost overruns
Vendor lock-in
Limited transparency in pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $10.5 million to THERMO ELECTRON NORTH AMERICA LLC. THERMO ELECTRON MAINTENANCE

Who is the contractor on this award?

The obligated recipient is THERMO ELECTRON NORTH AMERICA LLC.

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 $10.5 million.

What is the period of performance?

Start: 2007-09-01. End: 2012-05-31.

What was the justification for not competing this contract, and were alternative maintenance providers considered?

The justification for not competing this contract is not provided in the data. Typically, sole-source awards require a documented justification, such as unique capabilities of the vendor or lack of viable alternatives. Without this information, it's impossible to assess if the agency adequately explored competitive options or if the lack of competition was truly unavoidable.

How does the $10.5M maintenance cost compare to industry benchmarks for similar analytical instruments?

Benchmarking this $10.5M maintenance cost against industry standards is challenging without specific details on the instruments and the scope of services. However, given the lack of competition, it is reasonable to suspect that the cost may be higher than if multiple vendors had bid. A thorough review would involve comparing service level agreements and pricing structures of comparable contracts.

What is the potential impact on scientific research continuity if Thermo Electron is unable to provide maintenance?

The potential impact on scientific research continuity could be severe. If Thermo Electron is the sole provider of maintenance for these critical analytical instruments, any disruption in their service could halt or significantly delay research projects. This highlights the strategic importance of ensuring reliable maintenance and potentially having contingency plans in place.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Analytical Laboratory Instrument Manufacturing

Product/Service Code: INSTALLATION OF EQUIPMENT › INSTALLATION OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Thermo Electron Corporation (UEI: 001408673)

Address: 1400 NORTHPOINT PKWY STE 10, WEST PALM BEACH, FL, 33407

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $20,745,291

Exercised Options: $16,412,195

Current Obligation: $10,536,871

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline