NIH spent $31.8M on vaccine R&D, with Dynport Vaccine Company LLC awarded a cost-no-fee contract

Contract Overview

Contract Amount: $31,839,916 ($31.8M)

Contractor: Dynport Vaccine Company LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2005-09-30

End Date: 2013-12-11

Contract Duration: 2,994 days

Daily Burn Rate: $10.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST NO FEE

Sector: R&D

Official Description: JALAREMIA VACCINE DEVELOPMENT TEAM

Place of Performance

Location: FREDERICK, FREDERICK County, MARYLAND, 21702

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $31.8 million to DYNPORT VACCINE COMPANY LLC for work described as: JALAREMIA VACCINE DEVELOPMENT TEAM Key points: 1. Contract awarded for vaccine development, indicating a focus on critical public health research. 2. The contract duration of nearly 10 years suggests a long-term commitment to the research objective. 3. A single awardee implies a specific capability or technology was sought, potentially limiting broader market engagement. 4. The 'cost no fee' contract type suggests the government bears the direct costs of performance, with no additional profit margin for the contractor. 5. Research and Development in Life Sciences is a key area for federal investment, aligning with national health priorities. 6. The contract's value, while significant, needs to be benchmarked against similar R&D efforts to assess value for money.

Value Assessment

Rating: fair

Benchmarking the value of this $31.8 million contract is challenging without comparable R&D projects for specific vaccine development. The 'cost no fee' structure means the government covers all expenses, which can be efficient if costs are well-managed, but it also means the contractor does not have a direct financial incentive to minimize costs beyond what is necessary for successful research. The absence of a profit margin might indicate a focus on achieving research milestones rather than commercial viability.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting that multiple vendors had the opportunity to bid. However, with only three bids received, the level of competition may have been limited. This could be due to the specialized nature of the research or the specific requirements of the solicitation. A low number of bids can sometimes lead to less competitive pricing, although the 'cost no fee' structure mitigates direct profit-driven price inflation.

Taxpayer Impact: While full and open competition is ideal, only three bids suggest that the taxpayer may not have benefited from the widest possible price discovery. However, the 'cost no fee' structure means the primary cost to taxpayers is the direct expense of the research, not contractor profit.

Public Impact

The primary beneficiaries are likely the public, through the potential development of new vaccines. The services delivered are research and development activities aimed at creating novel vaccine technologies. The geographic impact is national, focusing on advancing U.S. public health capabilities. Workforce implications include employment for scientists, researchers, and support staff within the contractor's organization and potentially at NIH facilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited number of bids (3) despite full and open competition could indicate potential barriers to entry or a narrow field of qualified contractors.
The long contract duration (nearly 10 years) increases the risk of cost overruns or shifts in research priorities over time.
The 'cost no fee' contract type, while avoiding profit, places the burden of cost control entirely on the government's oversight.

Positive Signals

Awarded under full and open competition, maximizing the initial opportunity for qualified vendors.
The contract supports critical research and development in the life sciences, aligning with national health goals.
The specific focus on vaccine development addresses a vital area of public health preparedness.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on life sciences and biotechnology. The market for vaccine development is highly specialized, involving significant scientific expertise and regulatory hurdles. Federal spending in this area is crucial for addressing public health threats and advancing medical countermeasures. Comparable spending benchmarks would typically involve analyzing other NIH grants and contracts for similar R&D initiatives, considering the complexity and stage of development.

Small Business Impact

There is no indication of small business set-asides for this contract, and the contractor, Dynport Vaccine Company LLC, is not explicitly identified as a small business. The substantial value and specialized nature of the R&D may make it less accessible for small businesses without significant subcontracting opportunities. Further analysis would be needed to determine if any subcontracting plans were mandated or fulfilled.

Oversight & Accountability

Oversight for this contract would primarily reside with the National Institutes of Health (NIH), a component of the Department of Health and Human Services. Given the 'cost no fee' structure, rigorous financial and programmatic oversight is essential to ensure that funds are used efficiently and effectively towards research objectives. Transparency would be facilitated through regular reporting requirements from the contractor and potentially through public disclosures of research progress, subject to proprietary and national security considerations.

Related Government Programs

National Institutes of Health (NIH) Research Grants
Biomedical Advanced Research and Development Authority (BARDA) Contracts
Department of Defense Medical Countermeasures Programs
Centers for Disease Control and Prevention (CDC) Public Health Initiatives

Risk Flags

Long contract duration increases risk of obsolescence or changing priorities.
R&D inherently involves scientific uncertainty and potential for failure.
Limited number of bids may indicate a narrow competitive landscape.
'Cost no fee' requires intensive government oversight for cost control.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $31.8 million to DYNPORT VACCINE COMPANY LLC. JALAREMIA VACCINE DEVELOPMENT TEAM

Who is the contractor on this award?

The obligated recipient is DYNPORT VACCINE COMPANY LLC.

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 $31.8 million.

What is the period of performance?

Start: 2005-09-30. End: 2013-12-11.

What is the specific vaccine technology or disease target for this contract?

The provided data does not specify the exact vaccine technology or disease target for this contract. The description 'JALAREMIA VACCINE DEVELOPMENT TEAM' suggests a focus on a particular vaccine, possibly related to malaria or a similar ailment, but further details would be required from the contract's statement of work or associated documentation. Understanding the specific scientific objective is crucial for evaluating the contract's alignment with public health needs and assessing the technical risks involved in its development.

How does the $31.8 million cost compare to similar vaccine R&D contracts?

Benchmarking the $31.8 million cost against similar vaccine R&D contracts is difficult without more specific information on the contract's scope, duration, and the stage of development. Vaccine R&D is a complex and lengthy process, with costs varying significantly based on factors like the type of vaccine (e.g., mRNA, viral vector, subunit), the target pathogen, preclinical testing requirements, and clinical trial phases. A contract of this magnitude over nearly 10 years suggests a substantial, long-term research effort, potentially encompassing early-stage development through to advanced preclinical studies. To provide a meaningful comparison, one would need to identify contracts with similar objectives, timelines, and developmental stages awarded by agencies like NIH, BARDA, or DoD.

What are the key performance indicators (KPIs) and milestones for this contract?

The provided data does not detail the specific Key Performance Indicators (KPIs) or milestones for this contract. For a 'cost no fee' R&D contract, KPIs would typically focus on scientific progress, achievement of research objectives, adherence to timelines, and responsible management of funds. Milestones might include successful completion of laboratory experiments, preclinical efficacy studies, safety assessments, and potentially the development of a candidate vaccine ready for further testing. Effective oversight by the NIH would involve tracking progress against these defined milestones and KPIs to ensure the research is advancing as intended and that taxpayer funds are being utilized appropriately.

What is the track record of Dynport Vaccine Company LLC in vaccine development?

The provided data does not offer information on Dynport Vaccine Company LLC's specific track record in vaccine development. To assess this, one would need to consult external databases, company reports, or previous government contract awards. Key aspects to investigate would include their history of successful vaccine development, previous collaborations with government agencies, scientific publications, and any regulatory approvals or significant research breakthroughs attributed to the company. A strong track record would provide greater confidence in their ability to successfully execute this contract.

What is the risk assessment associated with this contract, considering its long duration and R&D nature?

The primary risks associated with this contract stem from its long duration (nearly 10 years) and its nature as a research and development project. Scientific R&D inherently carries uncertainty; the targeted vaccine may not prove effective or safe, leading to project failure. The extended timeline increases the risk of changing scientific landscapes, emerging alternative technologies, or shifts in public health priorities that could render the research obsolete. Furthermore, 'cost no fee' contracts require robust government oversight to manage costs effectively, as the contractor lacks a direct profit incentive to control expenses. Potential risks also include the contractor's ability to maintain scientific expertise and adapt to new findings over the decade-long period.

How does the 'cost no fee' contract type influence contractor behavior and government oversight?

The 'cost no fee' (Cost-No-Fee or CNF) contract type significantly alters contractor incentives and necessitates stringent government oversight. In a CNF contract, the contractor is reimbursed for all allowable direct and indirect costs incurred in performing the work, but receives no additional fee or profit. This structure is often used when the scope of work is uncertain or when the primary goal is to achieve a specific outcome rather than generate profit, such as in certain research and development scenarios. For the contractor, the incentive is to successfully complete the project, as their costs are covered, but without a profit motive, there might be less emphasis on efficiency or cost-saving measures compared to fixed-price contracts. Consequently, the government's role becomes critical in monitoring expenditures, ensuring costs are reasonable and allocable, and verifying that the research progresses effectively towards its objectives. Robust financial and programmatic oversight is paramount to prevent cost overruns and ensure value for taxpayer money.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences

Product/Service Code: RESEARCH AND DEVELOPMENT › Community and Regional Development R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: 64 THOMAS JOHNSON DR, FREDERICK, MD, 21702

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $33,598,244

Exercised Options: $31,839,916

Current Obligation: $31,839,916

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline