Leidos Biomedical Research Inc. awarded $38.5M contract for NCI Precision Oncology Network, a sole-source award

Contract Overview

Contract Amount: $38,534,220 ($38.5M)

Contractor: Leidos Biomedical Research Inc

Awarding Agency: Department of Health and Human Services

Start Date: 2017-09-21

End Date: 2022-09-20

Contract Duration: 1,825 days

Daily Burn Rate: $21.1K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Healthcare

Official Description: IGF::OT::IGF A NATIONAL CLINICAL LABORATORY NETWORK FOR NCI PRECISION ONCOLOGY IGF::OT::IGF

Place of Performance

Location: FREDERICK, FREDERICK County, MARYLAND, 21702

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $38.5 million to LEIDOS BIOMEDICAL RESEARCH INC for work described as: IGF::OT::IGF A NATIONAL CLINICAL LABORATORY NETWORK FOR NCI PRECISION ONCOLOGY IGF::OT::IGF Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, indicating potential for cost overruns. 2. Sole-source award limits competition, potentially impacting price discovery and value for money. 3. Contract duration of 5 years suggests a long-term need for these services. 4. The contract supports a critical area of cancer research, aligning with national health priorities. 5. Geographic location in Maryland may concentrate economic benefits within a specific region. 6. The absence of small business set-aside raises questions about opportunities for smaller entities.

Value Assessment

Rating: fair

The contract's value of $38.5 million over five years for a national clinical laboratory network is substantial. Benchmarking this against similar sole-source awards for specialized research infrastructure is challenging due to the unique nature of the NCI Precision Oncology Program. The cost-plus-fixed-fee structure requires careful monitoring to ensure costs remain reasonable and that the fixed fee adequately compensates the contractor for performance without excessive profit. Without competitive bidding, it's difficult to definitively assess if this represents the best possible value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning there was no open competition. This typically occurs when a specific contractor possesses unique capabilities, proprietary information, or when urgency dictates a direct award. The lack of multiple bidders means that price discovery through competitive negotiation was bypassed, which can sometimes lead to higher costs for the government compared to a fully competed contract.

Taxpayer Impact: Taxpayers may not benefit from the cost savings that can arise from a competitive bidding process. The government may have paid a premium due to the absence of competing offers.

Public Impact

Patients undergoing cancer treatment benefit from advancements in precision oncology. Researchers and clinicians gain access to a national network for clinical laboratory services. The National Cancer Institute (NCI) advances its mission to understand, prevent, and treat cancer. The contract supports the development of new diagnostic and therapeutic strategies in oncology. Workforce implications include specialized roles in clinical laboratory science and cancer research support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure on pricing.
Cost-plus-fixed-fee contract type can incentivize cost increases.
Lack of transparency in sole-source justification requires scrutiny.
Concentration of award in one large contractor may limit future market flexibility.
No small business subcontracting plan mentioned, potentially excluding smaller firms.

Positive Signals

Supports a critical national health initiative (Precision Oncology).
Long-term contract (5 years) provides stability for research continuity.
Awarded to a known entity (Leidos Biomedical Research Inc.) with established capabilities.
Contract aligns with strategic goals of the National Institutes of Health.

Sector Analysis

This contract falls within the broader healthcare and life sciences sector, specifically focusing on research and development services related to precision oncology. The market for clinical laboratory services is vast, but contracts supporting national research initiatives like the NCI's are often specialized. Leidos Biomedical Research Inc. is a significant player in government contracting for biomedical research support. Comparable spending benchmarks are difficult to establish precisely due to the sole-source nature and specific program focus, but significant federal investment is directed towards cancer research.

Small Business Impact

This contract was not competed and does not appear to have a small business set-aside. The absence of a set-aside suggests that opportunities for small businesses to directly participate as prime contractors were not pursued. Furthermore, without explicit subcontracting requirements, the extent to which small businesses will benefit from this award is uncertain. This could limit the integration of innovative small businesses into this critical research network.

Oversight & Accountability

Oversight for this contract would primarily fall under the National Institutes of Health (NIH) and the National Cancer Institute (NCI). As a sole-source award, the justification and terms require rigorous review. The cost-plus-fixed-fee structure necessitates close monitoring of expenditures by the contracting officer's representative (COR) to ensure costs are reasonable and allocable. Transparency regarding the performance metrics and financial reporting would be key accountability measures. The Inspector General for the Department of Health and Human Services would have jurisdiction for audits and investigations.

Related Government Programs

National Cancer Institute (NCI) Programs
Precision Medicine Initiative
Biomedical Research Support Contracts
Clinical Laboratory Services Contracts
Department of Health and Human Services Research Grants

Risk Flags

Sole-source award lacks competitive justification.
Cost-plus-fixed-fee contract type poses cost overrun risk.
Limited transparency on performance metrics and oversight.
No explicit small business subcontracting requirements.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $38.5 million to LEIDOS BIOMEDICAL RESEARCH INC. IGF::OT::IGF A NATIONAL CLINICAL LABORATORY NETWORK FOR NCI PRECISION ONCOLOGY IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is LEIDOS BIOMEDICAL RESEARCH 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 $38.5 million.

What is the period of performance?

Start: 2017-09-21. End: 2022-09-20.

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

The provided data does not include the specific justification for the sole-source award. Typically, sole-source contracts are awarded when only one responsible source is available to meet the government's needs. This could be due to unique capabilities, proprietary technology, or urgent and compelling circumstances. A detailed justification document, often required by federal acquisition regulations, would outline the rationale. Without this document, it is difficult to fully assess the necessity of bypassing the competitive process and its potential impact on cost and value.

How does the cost-plus-fixed-fee structure compare to other contract types for similar research services?

Cost-plus-fixed-fee (CPFF) contracts are common for research and development where the scope of work may evolve, making it difficult to define a fixed price upfront. However, CPFF contracts carry inherent risks for the government. While the contractor's fee is fixed, the total cost is not, potentially leading to cost overruns if not managed diligently. Other contract types like Firm-Fixed-Price (FFP) offer greater cost certainty but are less suitable for R&D with undefined elements. For specialized research infrastructure, CPFF is often used, but it necessitates robust oversight to ensure cost efficiency and prevent contractor complacency in managing expenses.

What are the key performance indicators (KPIs) for this contract and how is performance being measured?

The provided data does not specify the key performance indicators (KPIs) or the methods used for performance measurement under this contract. For a contract supporting a national clinical laboratory network for precision oncology, KPIs would likely include metrics related to turnaround times for laboratory tests, accuracy and reliability of results, data management and security, adherence to research protocols, and contribution to NCI's research objectives. Effective oversight would involve regular performance reviews against these KPIs to ensure the contractor is meeting its obligations and delivering value.

What is the historical spending pattern for similar NCI clinical laboratory network services?

The provided data focuses on a single contract award. To understand historical spending patterns for similar NCI clinical laboratory network services, one would need to analyze contract databases for previous awards related to NCI's laboratory support functions, particularly those supporting precision oncology or similar large-scale research initiatives. This would involve looking at contract values, durations, award types (competed vs. sole-source), and the contractors involved over several fiscal years. Without this broader historical context, it's challenging to determine if the $38.5 million award represents an increase, decrease, or stable level of investment in this area.

What is the track record of Leidos Biomedical Research Inc. in managing large-scale federal health research contracts?

Leidos Biomedical Research Inc. has a significant track record in managing large-scale federal health research contracts, particularly for agencies like the National Institutes of Health (NIH). They operate the Frederick National Laboratory for Cancer Research (FNLCR) under contract with the National Cancer Institute (NCI), which is a substantial undertaking involving complex scientific research, laboratory operations, and data management. Their experience suggests they possess the infrastructure and expertise to handle contracts of this nature. However, the performance history on specific contracts, including adherence to budget, timelines, and scientific objectives, would require a deeper dive into contract performance reports and oversight records.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N01CO5240180

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Leidos Holdings, Inc. (UEI: 611641312)

Address: 1050 BOYLES ST, FREDERICK, MD, 21702

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $38,534,220

Exercised Options: $38,534,220

Current Obligation: $38,534,220

Actual Outlays: $26,046,052

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $587,260

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: HHSN261201500003I

IDV Type: IDC

Timeline