NIH awards $10M+ for biomedical research to Michigan State University, spanning over 5 years

Contract Overview

Contract Amount: $10,052,135 ($10.1M)

Contractor: Michigan State University

Awarding Agency: Department of Health and Human Services

Start Date: 2007-09-28

End Date: 2012-09-27

Contract Duration: 1,826 days

Daily Burn Rate: $5.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 18

Pricing Type: COST NO FEE

Sector: R&D

Official Description: BIOMEDICAL (APPLIED/EXPLORATORY)

Place of Performance

Location: EAST LANSING, INGHAM County, MICHIGAN, 48824

State: Michigan Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $10.1 million to MICHIGAN STATE UNIVERSITY for work described as: BIOMEDICAL (APPLIED/EXPLORATORY) Key points: 1. Contract value appears reasonable for the extensive research duration and scope. 2. Full and open competition suggests a competitive bidding process was utilized. 3. No specific risk indicators are immediately apparent from the provided data. 4. This contract falls within the R&D sector, specifically applied biomedical research. 5. The awardee, Michigan State University, is a known research institution. 6. The contract type (Cost No Fee) is common for research and development projects.

Value Assessment

Rating: good

The contract value of over $10 million for a five-year biomedical research project appears to be within a reasonable range for the scope of work. Without specific benchmarks for comparable applied research projects at this scale, a precise value-for-money assessment is challenging. However, the duration and the nature of R&D suggest a significant investment is expected. The 'Cost No Fee' contract type indicates that the government reimburses the contractor for allowable costs, with no additional profit margin, which is typical for certain types of research where the final outcomes are uncertain.

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. This suggests a robust bidding process designed to solicit the best offers. The number of bidders (18) further supports the notion of a competitive environment, which generally leads to better pricing and innovation for the government.

Taxpayer Impact: A full and open competition with multiple bidders is beneficial for taxpayers as it increases the likelihood of securing the most cost-effective and technically sound research proposal, maximizing the return on investment for federal funds.

Public Impact

The primary beneficiaries are researchers at Michigan State University, who will receive funding to advance biomedical knowledge. The services delivered include applied and exploratory research in the physical, engineering, and life sciences. The geographic impact is centered in Michigan, where the university is located, potentially fostering local scientific talent and infrastructure. Workforce implications include support for researchers, technicians, and students involved in the project.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for research outcomes to not meet initial expectations given the inherent uncertainties in R&D.
The 'Cost No Fee' structure requires diligent oversight to ensure costs are allowable and reasonable.

Positive Signals

Award to a reputable university suggests a strong likelihood of scientific rigor and adherence to research standards.
The extensive competition indicates a potentially high-quality proposal was selected.
Long-term funding commitment allows for sustained research efforts and potential breakthroughs.

Sector Analysis

This contract falls under the Research and Development sector, specifically within the NAICS code 541710, which covers Research and Development in the Physical, Engineering, and Life Sciences. This is a significant area of federal investment, with agencies like NIH funding a vast array of scientific exploration. Comparable spending benchmarks would involve looking at other large-scale, multi-year R&D grants awarded by NIH and other science-focused federal agencies to academic institutions.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside criterion for this contract (ss: false, sb: false). As a large research grant awarded to a university, the primary focus is on scientific merit and institutional capacity rather than small business subcontracting goals. However, the university may engage small businesses for specific services or supplies as needed during the research process.

Oversight & Accountability

Oversight for this contract would primarily reside with the National Institutes of Health (NIH), a division of the Department of Health and Human Services. NIH program officers and contracting officials would monitor the research progress, adherence to grant terms, and financial expenditures. The 'Cost No Fee' structure necessitates careful review of incurred costs to ensure they align with the approved research plan and federal regulations. Transparency is generally maintained through periodic reporting requirements from the awardee.

Related Government Programs

National Institutes of Health Research Grants
Biomedical Research Funding
University Research and Development Contracts
Applied Science Research Programs

Risk Flags

Long-term R&D projects carry inherent uncertainty regarding successful outcomes.
Cost-reimbursement contracts require diligent oversight to manage expenditures.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $10.1 million to MICHIGAN STATE UNIVERSITY. BIOMEDICAL (APPLIED/EXPLORATORY)

Who is the contractor on this award?

The obligated recipient is MICHIGAN STATE UNIVERSITY.

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 $10.1 million.

What is the period of performance?

Start: 2007-09-28. End: 2012-09-27.

What is the track record of Michigan State University in securing and managing large federal research grants, particularly from NIH?

Michigan State University (MSU) has a well-established history of securing significant federal funding for research, including substantial grants from the National Institutes of Health (NIH). As a major research institution, MSU routinely manages complex, multi-year projects across various scientific disciplines. Their track record typically involves successful proposal development, adherence to rigorous scientific and ethical standards, and effective financial management of awarded funds. Specific details on their success rates and management of prior NIH grants would require a deeper dive into federal databases like NIH RePORTER and USAspending, but their designation as a top-tier research university implies a strong capacity to handle contracts of this magnitude.

How does the awarded amount of over $10 million compare to other NIH grants for similar biomedical research projects?

The awarded amount of over $10 million for a five-year project is substantial but not unusual for large-scale, multi-disciplinary biomedical research initiatives funded by the NIH. NIH grants vary widely in size depending on the scope, duration, and specific research area. Projects involving complex experimental designs, multiple research teams, specialized equipment, and extensive personnel often reach or exceed this funding level. To provide a precise comparison, one would need to analyze NIH funding data for similar NAICS codes (e.g., 541710) and research areas (e.g., applied biomedical research) over comparable timeframes, looking at the distribution of award sizes.

What are the primary risks associated with a 'Cost No Fee' contract for biomedical R&D?

The primary risks associated with a 'Cost No Fee' (CNF) contract for biomedical R&D revolve around cost control and the uncertainty of research outcomes. For the government, the risk is ensuring that the costs incurred by the contractor are reasonable, allocable, and allowable according to federal regulations, as there is no pre-defined profit margin to incentivize cost efficiency. Diligent oversight and auditing are crucial. For the contractor (MSU in this case), the risk is that the actual costs of conducting the research may exceed the anticipated budget, and they will not receive additional compensation beyond the reimbursement of approved costs. Furthermore, R&D inherently carries the risk that the research objectives may not be fully met, regardless of the costs expended.

What does the '18' bidder count signify in terms of program effectiveness and value for taxpayers?

A count of 18 bidders for this contract signifies a highly competitive procurement process under 'Full and Open Competition.' This level of competition is generally positive for program effectiveness and taxpayer value. It suggests that the research opportunity was attractive and accessible to a wide range of qualified entities. High competition typically drives down prices, encourages innovation in proposals, and increases the likelihood that the government selects the most technically superior and cost-effective solution. For taxpayers, this means federal funds are more likely to be allocated to a project that offers the best potential return on investment in terms of scientific advancement and potential health benefits.

How does the duration of the contract (over 5 years) impact the assessment of its value?

The duration of over five years (1826 days) for this biomedical research contract is a significant factor in assessing its value. Long-term funding commitments are often necessary for complex R&D projects, allowing researchers the time needed to conduct in-depth studies, gather sufficient data, and potentially achieve meaningful scientific breakthroughs. While a longer duration naturally implies a higher total contract value, it also suggests a sustained investment in a particular area of research. The value is assessed not just by the total dollars spent, but by the potential long-term scientific, medical, or economic benefits that can arise from sustained, focused research efforts. Evaluating the value requires considering the progress milestones and deliverables outlined in the contract over its lifespan.

What is the significance of the 'PT: COST NO FEE' contract type in the context of R&D spending?

The 'PT: COST NO FEE' (Cost No Fee) contract type is particularly relevant for research and development (R&D) endeavors where the final outcomes are inherently uncertain and difficult to define precisely at the outset. In this structure, the government agrees to reimburse the contractor (Michigan State University) for all legitimate, allowable, and reasonable costs incurred in performing the research, but the contractor does not receive any additional fee or profit. This type of contract shifts the financial risk associated with the *profitability* of the project entirely to the government, as they bear the full cost of the research. However, it is often used when the government's primary goal is to fund the exploration of scientific questions or the development of new technologies, and the emphasis is on achieving the research objectives rather than on the contractor's profit margin. It necessitates robust government oversight to manage costs effectively.

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: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: RFPNIHNICHD0711E

Offers Received: 18

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Address: 301 ADMINISTRATION BLDG, EAST LANSING, MI, 07

Business Categories: Category Business, Educational Institution, Higher Education, Hospital, Not Designated a Small Business, Special Designations, U.S.-Owned Business, Veterinary Hospital

Financial Breakdown

Contract Ceiling: $40,237,593

Exercised Options: $15,182,076

Current Obligation: $10,052,135

Contract Characteristics

Multi-Year Contract: Yes

Timeline