NIH awards $25.5M for biomedical research, with Endeavor Health securing a cost-plus-fixed-fee contract

Contract Overview

Contract Amount: $25,516,320 ($25.5M)

Contractor: Endeavor Health Clinical Operations

Awarding Agency: Department of Health and Human Services

Start Date: 2006-09-30

End Date: 2012-09-30

Contract Duration: 2,192 days

Daily Burn Rate: $11.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: BIOMEDICAL (BASIC)

Place of Performance

Location: EVANSTON, COOK County, ILLINOIS, 60201

State: Illinois Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $25.5 million to ENDEAVOR HEALTH CLINICAL OPERATIONS for work described as: BIOMEDICAL (BASIC) Key points: 1. Contract awarded through full and open competition, suggesting a robust market. 2. The contract type (Cost Plus Fixed Fee) allows for flexibility but requires careful cost monitoring. 3. A duration of 2192 days indicates a long-term commitment to the research area. 4. The base value of $1.16M suggests initial funding, with significant potential for growth. 5. The North American Industry Classification System (NAICS) code 541720 points to Research and Development in the Social Sciences and Humanities, though the description is 'BIOMEDICAL (BASIC)' which may indicate a discrepancy or specialized focus. 6. The contract was awarded to a single entity, Endeavor Health Clinical Operations. 7. The contract was awarded in Illinois, indicating a specific geographic focus for the research.

Value Assessment

Rating: fair

The contract's base value of $1.16M is relatively modest for a multi-year research endeavor. The total award of $25.5M over approximately six years suggests a significant ramp-up in funding. Without comparable contracts for similar biomedical basic research, it's difficult to definitively benchmark value. The Cost Plus Fixed Fee (CPFF) structure means costs are reimbursed, plus a fixed fee, which can incentivize efficiency but also requires diligent oversight to prevent cost overruns.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION,' indicating that all responsible sources were permitted to submit a bid. The presence of two bids suggests a moderate level of competition for this specific research area. While two bidders is better than a sole source, a higher number of bids would typically lead to more competitive pricing and potentially better value for the government.

Taxpayer Impact: A full and open competition, even with only two bidders, generally provides a better opportunity for price discovery and ensures taxpayers are not unduly burdened by a lack of market engagement.

Public Impact

This contract supports biomedical basic research, potentially leading to advancements in health and medicine. The research is conducted by Endeavor Health Clinical Operations, a private entity. The geographic impact is centered in Illinois, where the contractor is located. The contract may indirectly impact the scientific workforce by funding research positions and collaborations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to the Cost Plus Fixed Fee (CPFF) contract type.
The discrepancy between the NAICS code description and the contract description ('BIOMEDICAL (BASIC)') warrants clarification to ensure accurate categorization and oversight.
Limited competition with only two bids could mean less competitive pricing than a more robust bidding process.
Long contract duration (2192 days) requires sustained oversight to ensure continued relevance and performance.
The base award amount is significantly lower than the total award, indicating potential for substantial future spending that needs careful management.

Positive Signals

Awarded through full and open competition, maximizing the pool of potential contractors.
The fixed fee component of the CPFF contract provides a defined profit margin, which can be a positive signal of contractor expectation.
The contract supports critical biomedical research, aligning with national health priorities.
The long duration suggests a stable, long-term investment in a specific research area.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on biomedical basic research. The R&D sector is characterized by innovation and long-term investment. Comparable spending benchmarks for biomedical research can vary widely depending on the specific field, scale, and duration. Government funding through agencies like NIH is a primary driver of basic scientific discovery, often supporting academic institutions and private research organizations.

Small Business Impact

There is no indication that this contract involved small business set-asides. The contractor, Endeavor Health Clinical Operations, is likely a larger entity. Subcontracting opportunities for small businesses are not explicitly detailed but could arise if Endeavor Health requires specialized services or supplies during the research period. The overall impact on the small business ecosystem is likely minimal unless significant subcontracting occurs.

Oversight & Accountability

Oversight for this contract would primarily fall under the National Institutes of Health (NIH), a component of the Department of Health and Human Services (HHS). As a Cost Plus Fixed Fee contract, rigorous financial oversight is crucial to monitor expenditures and ensure the fixed fee is justified. Transparency is typically managed through contract reporting mechanisms and public databases. The HHS Office of Inspector General (OIG) would have jurisdiction for audits and investigations related to potential fraud, waste, or abuse.

Related Government Programs

National Institutes of Health (NIH) Research Grants
Department of Health and Human Services (HHS) Biomedical Research Programs
Federal Contracts for Scientific Research
Cost-Plus-Fixed-Fee Contracts

Risk Flags

Potential for cost creep due to CPFF contract type.
NAICS code discrepancy requires clarification.
Long contract duration poses risks of obsolescence or changing priorities.
Limited competition (2 bidders) may impact price discovery.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $25.5 million to ENDEAVOR HEALTH CLINICAL OPERATIONS. BIOMEDICAL (BASIC)

Who is the contractor on this award?

The obligated recipient is ENDEAVOR HEALTH CLINICAL OPERATIONS.

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 $25.5 million.

What is the period of performance?

Start: 2006-09-30. End: 2012-09-30.

What is the specific nature of the 'BIOMEDICAL (BASIC)' research being conducted under NAICS code 541720 (Research and Development in the Social Sciences and Humanities)?

The provided data presents a potential discrepancy between the NAICS code (541720: Research and Development in the Social Sciences and Humanities) and the contract description ('BIOMEDICAL (BASIC)'). Typically, biomedical research falls under NAICS codes like 541714 (Research and Development in Biotechnology (except Nanobiotechnology)) or 541715 (Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology)). It is possible that the 'Social Sciences and Humanities' code is being used in a broader sense, or that the research has a significant interdisciplinary component involving social or behavioral aspects of health. Clarification from the awarding agency (NIH) would be necessary to precisely understand the research scope and ensure accurate classification for future analysis and benchmarking.

How does the Cost Plus Fixed Fee (CPFF) structure compare to other contract types for similar long-term biomedical research projects?

Cost Plus Fixed Fee (CPFF) contracts are common for research and development where the scope of work is not precisely defined at the outset, allowing for flexibility as research progresses. In CPFF, the contractor is reimbursed for all allowable costs plus a fixed fee, which represents profit. This contrasts with Firm-Fixed-Price (FFP) contracts, where the price is set regardless of costs, offering more cost certainty for the government but less flexibility for the contractor. For long-term biomedical research, CPFF can be advantageous when the research path is uncertain, encouraging exploration. However, it places a greater burden on the government to meticulously track and audit costs to prevent overspending, as the contractor has less incentive to control costs beyond what is necessary to complete the work within the agreed-upon scope. Other options like Cost Plus Incentive Fee (CPIF) could offer better value by linking fee to performance metrics.

What is the historical spending pattern for Endeavor Health Clinical Operations with the federal government?

Analyzing the historical spending patterns of Endeavor Health Clinical Operations with the federal government is crucial for assessing their track record and reliability. Without access to a comprehensive federal procurement database or specific contract history for this entity, a detailed analysis is not possible from the provided data alone. However, the fact that they were awarded a significant contract by NIH suggests they have likely had prior federal contracts or possess the necessary qualifications and experience. A deeper dive would involve searching databases like FPDS-NG or SAM.gov to identify previous awards, contract types, agencies involved, and performance history. This would help determine if they have a history of successful project completion, cost adherence, and compliance with federal regulations, informing the risk assessment for this current award.

What are the potential risks associated with a long-duration contract (2192 days) for basic research?

Long-duration contracts for basic research, such as this 2192-day (approximately 6-year) award, carry several potential risks. Firstly, the scientific landscape can evolve rapidly; research priorities may shift, or new discoveries could render the original research objectives less relevant or obsolete before completion. Secondly, maintaining consistent oversight and engagement over such an extended period can be challenging for government program managers, potentially leading to a lapse in monitoring performance or adapting to unforeseen issues. Thirdly, the contractor's key personnel or institutional capabilities might change, impacting the project's continuity and success. Finally, the longer the contract duration, the greater the potential for cumulative cost increases if not managed meticulously, especially with CPFF structures. Mitigation strategies include incorporating periodic reviews, clear milestones, and flexibility clauses within the contract.

How does the base award amount ($1.16M) relate to the total award amount ($25.5M) and what does this imply?

The significant difference between the base award amount of $1.16 million and the total award amount of $25.5 million for this contract implies that the initial funding was modest, likely covering the early stages or specific initial tasks of the research project. The substantial increase to the total award ceiling indicates that the government anticipates significant future work and funding obligations over the contract's duration. This structure is common in research and development where the full scope and cost are not known upfront. It suggests a phased approach to funding, contingent on successful progress and continued need. For taxpayers, this means the potential for a large expenditure, necessitating robust oversight to ensure the funds are used effectively and the research remains aligned with objectives as it scales up.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Social Sciences and Humanities

Product/Service Code: RESEARCH AND DEVELOPMENT › N – Health R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1301 CENTRAL ST, EVANSTON, IL, 60201

Business Categories: Category Business, Corporate Entity Tax Exempt, Educational Institution, Foundation, Higher Education, Hospital, Nonprofit Organization, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $72,892,252

Exercised Options: $70,492,252

Current Obligation: $25,516,320

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline