NIH awarded $18.3M for R&D in drug dependency, with XOMA LTD. as the sole contractor

Contract Overview

Contract Amount: $18,292,747 ($18.3M)

Contractor: Xoma Ltd.

Awarding Agency: Department of Health and Human Services

Start Date: 2006-07-28

End Date: 2013-11-22

Contract Duration: 2,674 days

Daily Burn Rate: $6.8K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: R&D-DRUG DEPENDENCY-A RES/EXPL DEV

Place of Performance

Location: BERKELEY, ALAMEDA County, CALIFORNIA, 94710

State: California Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $18.3 million to XOMA LTD. for work described as: R&D-DRUG DEPENDENCY-A RES/EXPL DEV Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. Long contract duration of over 2600 days suggests a sustained research effort. 3. Cost-plus-fixed-fee structure may incentivize cost escalation. 4. The contract falls under R&D in Physical, Engineering, and Life Sciences. 5. Focus on drug dependency research addresses a significant public health concern.

Value Assessment

Rating: questionable

The contract's value of $18.3 million over its extended period is difficult to benchmark without more specific details on deliverables and research outcomes. The cost-plus-fixed-fee (CPFF) pricing structure, while common for R&D, can lead to higher costs compared to fixed-price contracts if not managed carefully. Given the sole-source nature, there's no direct comparison to assess if the pricing is competitive.

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 typically occurs when a specific contractor possesses unique capabilities or intellectual property essential for the project. The lack of competition means there was no opportunity for multiple vendors to bid, potentially impacting price discovery and the government's ability to secure the best possible price.

Taxpayer Impact: Taxpayers may not have received the benefit of competitive pricing, as the government could not leverage multiple offers to drive down costs.

Public Impact

Benefits researchers and institutions focused on understanding and treating drug dependency. Services delivered include advanced research and development in the life sciences. Geographic impact is primarily within California where the contractor is located, but research findings have national implications. Workforce implications include support for scientific and research personnel.

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 lead to cost overruns if not closely monitored.
Long contract duration may indicate potential for scope creep or evolving research needs.

Positive Signals

Addresses a critical public health issue: drug dependency.
Contract supports specialized R&D capabilities.
Long-term engagement suggests a commitment to advancing scientific knowledge in a complex area.

Sector Analysis

This contract falls under the Research and Development in the Physical, Engineering, and Life Sciences sector, specifically focusing on drug dependency. This is a critical area within the broader life sciences and healthcare R&D market. Government spending in this sector often supports foundational research that private industry may not undertake due to high risk and long development timelines. Comparable spending benchmarks would typically be found within NIH's broader R&D portfolio for similar therapeutic areas.

Small Business Impact

There is no indication that this contract involved small business set-asides. As a sole-source award to a specific entity, it is unlikely to have direct subcontracting opportunities for small businesses unless initiated by the prime contractor. The impact on the small business ecosystem is likely minimal for this particular award.

Oversight & Accountability

Oversight for this contract would typically be managed by the National Institutes of Health (NIH) program officials and contracting officers. Accountability measures would be tied to the achievement of research milestones outlined in the Cost Plus Fixed Fee agreement. Transparency is generally limited for sole-source R&D contracts, with details often restricted due to proprietary research information.

Related Government Programs

National Institute on Drug Abuse (NIDA) research grants
Substance Abuse and Mental Health Services Administration (SAMHSA) programs
Biomedical Advanced Research and Development Authority (BARDA) initiatives

Risk Flags

Sole-source award
Cost-plus-fixed-fee pricing
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $18.3 million to XOMA LTD.. R&D-DRUG DEPENDENCY-A RES/EXPL DEV

Who is the contractor on this award?

The obligated recipient is XOMA LTD..

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 $18.3 million.

What is the period of performance?

Start: 2006-07-28. End: 2013-11-22.

What specific research objectives were outlined in this contract, and how were they measured?

The contract focused on Research and Development related to drug dependency. Specific objectives would have been detailed in the contract's Statement of Work (SOW). These typically involve preclinical studies, development of therapeutic agents, or understanding the underlying biological mechanisms of addiction. Performance would be measured against defined milestones, deliverables (e.g., research reports, data sets, prototypes), and adherence to scientific protocols. The Cost Plus Fixed Fee structure implies that the contractor is reimbursed for allowable costs plus a fixed fee representing profit, with performance tied to achieving these research goals.

How does the $18.3 million award compare to other R&D contracts for drug dependency research?

Benchmarking this $18.3 million award requires comparing it to similar R&D contracts specifically targeting drug dependency. NIH, through its various institutes like NIDA, funds numerous research projects. Larger, multi-year R&D efforts can range from tens to hundreds of millions of dollars, depending on the scope, phase (e.g., basic research vs. clinical trials), and the specific therapeutic targets. Without knowing the precise stage and objectives of XOMA LTD.'s research, a direct comparison is challenging. However, $18.3 million over a period of approximately 7 years (2006-2013) suggests a significant, but not exceptionally large, investment for a focused R&D program in this area.

What are the risks associated with a sole-source, cost-plus-fixed-fee contract for R&D?

Sole-source awards carry the inherent risk of reduced price competition, potentially leading to higher costs for the government. The Cost Plus Fixed Fee (CPFF) structure, while providing flexibility for R&D where costs can be uncertain, also presents risks. The 'cost-plus' element means the government reimburses the contractor's allowable costs, which can escalate if not rigorously managed. The 'fixed fee' provides the contractor with a predetermined profit, but the overall cost to the government is not fixed. Risks include potential for cost overruns, less incentive for the contractor to control costs aggressively, and the need for robust government oversight to ensure efficiency and prevent waste.

What is XOMA LTD.'s track record in R&D, particularly in the area of drug dependency?

XOMA LTD. is a biotechnology company with a history of developing therapeutic antibodies. Their track record in R&D would need to be assessed based on their portfolio of developed drugs, successful clinical trials, and previous government contracts. Information regarding their specific expertise and success in the area of drug dependency research would be crucial. A review of their scientific publications, patent filings, and past performance evaluations on government contracts would provide insight into their capabilities and reliability in this specialized field.

What was the historical spending pattern for drug dependency R&D by the NIH prior to and during this contract period?

NIH's historical spending on drug dependency R&D, primarily through NIDA, has generally shown a consistent commitment to understanding addiction and developing treatments. Annual funding levels can fluctuate based on congressional appropriations, administration priorities, and emerging scientific opportunities. During the period of this contract (2006-2013), NIH's overall R&D budget was substantial, and specific allocations for addiction research would have been a component. Analyzing NIH's budget justifications and award databases for those years would reveal trends in funding for drug dependency research, helping to contextualize the $18.3 million awarded to XOMA LTD. within the broader federal investment.

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 › N – Health R&D Services

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: NIHNIAIDDMID0638

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 2910 SEVENTH ST, BERKELEY, CA, 94710

Business Categories: Category Business, Small Business

Financial Breakdown

Contract Ceiling: $18,292,747

Exercised Options: $18,292,747

Current Obligation: $18,292,747

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline