Leidos Inc. awarded $24.3M for NIH IT software maintenance, highlighting a 5-year contract for essential services

Contract Overview

Contract Amount: $24,330,017 ($24.3M)

Contractor: Leidos, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2017-08-02

End Date: 2022-01-02

Contract Duration: 1,614 days

Daily Burn Rate: $15.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IGF::OT::IGF ITAC TO30 SOFTWARE MAINTENANCE

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20190

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $24.3 million to LEIDOS, INC. for work described as: IGF::OT::IGF ITAC TO30 SOFTWARE MAINTENANCE Key points: 1. Contract value of $24.3 million over five years suggests a significant investment in IT infrastructure. 2. The award to Leidos Inc. indicates a reliance on established contractors for critical software maintenance. 3. A firm-fixed-price contract structure aims to control costs and provide budget certainty. 4. The 'Other Computer Related Services' NAICS code points to a broad scope of IT support. 5. The contract duration of 1614 days (approx. 4.4 years) aligns with typical IT lifecycle management. 6. The BPA Call award type suggests this was a task order under a pre-existing agreement.

Value Assessment

Rating: good

The contract value of $24.3 million over approximately 4.4 years for software maintenance appears reasonable given the scope of IT services typically required by a large agency like NIH. Benchmarking against similar IT maintenance contracts would provide a more precise value-for-money assessment, but the firm-fixed-price structure suggests an effort to manage costs effectively. The absence of specific performance metrics in the provided data makes a definitive assessment of efficiency challenging, but the duration implies a sustained need for these services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of two bids suggests a competitive process, though the exact number of interested parties and the rigor of the evaluation are not detailed. Full and open competition generally promotes price discovery and encourages vendors to offer competitive pricing to secure the award.

Taxpayer Impact: Taxpayers benefit from full and open competition as it typically leads to more favorable pricing and a wider selection of qualified vendors, ensuring the government receives the best value for its investment.

Public Impact

The National Institutes of Health (NIH) benefits directly through the continued availability of critical IT software maintenance, ensuring operational continuity. Researchers and administrative staff at NIH will have access to reliable IT systems, supporting their work in medical research and public health. The contract supports the IT infrastructure necessary for advancing biomedical research and improving public health outcomes. Geographic impact is primarily concentrated around NIH facilities, likely in Maryland, where the IT services are directly applied.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if specialized knowledge is developed by Leidos Inc. that is difficult for others to replicate.
Reliance on a single contractor for critical software maintenance could pose a risk if performance issues arise or if the contractor's business strategy changes.

Positive Signals

The firm-fixed-price contract structure provides cost certainty for the government.
Awarding to an established contractor like Leidos Inc. may indicate a track record of successful performance.
Full and open competition suggests a robust procurement process that likely vetted multiple capable vendors.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on software maintenance and related computer services. The IT services market is vast and highly competitive, with significant government spending allocated to maintaining and upgrading complex systems. Comparable spending benchmarks for IT software maintenance contracts of this size and duration are common across federal agencies, reflecting the ongoing need for robust IT support to manage vast amounts of data and complex operations.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a result, there are no direct subcontracting implications for small businesses stemming from a set-aside provision. However, the prime contractor, Leidos Inc., may engage small businesses as subcontractors for specific services, though this is not explicitly detailed in the award information. The absence of a small business set-aside means the primary competition was open to all eligible large businesses.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program office within the National Institutes of Health. Accountability measures are inherent in the firm-fixed-price contract, requiring delivery of specified services. Transparency is facilitated through contract award databases, though detailed performance reports are often internal. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

NIH IT Support Services
Federal Software Maintenance Contracts
Health IT Services
Large-Scale IT Infrastructure Support

Risk Flags

Potential for vendor lock-in
Reliance on single source for critical services
Contract duration may exceed actual need if technology evolves rapidly

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $24.3 million to LEIDOS, INC.. IGF::OT::IGF ITAC TO30 SOFTWARE MAINTENANCE

Who is the contractor on this award?

The obligated recipient is LEIDOS, 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 $24.3 million.

What is the period of performance?

Start: 2017-08-02. End: 2022-01-02.

What is the historical spending pattern for software maintenance at the National Institutes of Health?

Analyzing historical spending patterns for software maintenance at the NIH is crucial for understanding budget trends and identifying potential efficiencies. While this specific contract represents $24.3 million over approximately 4.4 years, a broader analysis would involve examining annual IT budgets, the number and value of similar software maintenance contracts awarded over the past 5-10 years, and the specific types of software covered. This would help determine if spending has been consistent, increasing, or decreasing, and whether the current award aligns with historical investment levels. It would also reveal if there's a trend towards consolidating maintenance contracts or shifting towards cloud-based solutions, which could impact future spending.

How does the pricing of this contract compare to similar IT software maintenance contracts awarded by other federal agencies?

Benchmarking the pricing of this $24.3 million contract against similar IT software maintenance agreements across federal agencies is essential for assessing value for money. This involves comparing the per-year cost, the scope of services included (e.g., number of software titles, level of support, response times), and the specific technologies maintained. Factors such as the size and complexity of the agency, the criticality of the software, and the prevailing market rates for IT services should be considered. If this contract's pricing is significantly higher or lower than comparable contracts, it warrants further investigation into the underlying cost drivers and potential efficiencies or inefficiencies.

What is Leidos Inc.'s track record with federal IT software maintenance contracts, particularly with the NIH?

Evaluating Leidos Inc.'s track record with federal IT software maintenance contracts, especially those with the NIH, provides insight into their performance reliability and expertise. This would involve reviewing past contract awards to Leidos for similar services, examining performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and identifying any past issues or disputes. A history of successful contract completion, positive performance reviews, and timely delivery of services would indicate a lower risk associated with this current award. Conversely, a pattern of performance problems or contract terminations could raise concerns about Leidos's ability to meet the NIH's requirements effectively.

What are the specific risks associated with relying on a single contractor, Leidos Inc., for this critical software maintenance?

The primary risks associated with relying on a single contractor like Leidos Inc. for critical software maintenance include potential vendor lock-in, reduced negotiating leverage in future contract renewals, and vulnerability to disruptions if the contractor faces financial difficulties, operational issues, or strategic shifts. If Leidos develops unique expertise or proprietary tools for maintaining the NIH's systems, it could become difficult and costly to transition to another vendor. Furthermore, a lack of ongoing competition might lead to price increases in subsequent contract periods. Mitigating these risks often involves robust contract management, clear performance expectations, and contingency planning for potential service disruptions.

How effective are the current oversight mechanisms in ensuring the successful performance and value delivery of this contract?

The effectiveness of oversight mechanisms for this contract hinges on the diligence of the contracting officer and the program management team at NIH. Key oversight activities include regular performance reviews, monitoring adherence to service level agreements (SLAs), tracking expenditures against the contract ceiling, and ensuring compliance with all contractual terms. Transparency is enhanced through public contract databases, but internal reporting and communication channels are vital for day-to-day oversight. The presence of an Inspector General provides an additional layer of accountability for detecting and preventing fraud, waste, and abuse, but proactive management is the first line of defense in ensuring value delivery.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: FCISJB980001B

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

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

Address: 11955 FREEDOM DR, RESTON, VA, 20190

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

Financial Breakdown

Contract Ceiling: $24,786,280

Exercised Options: $24,330,017

Current Obligation: $24,330,017

Actual Outlays: $3,408,944

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: HHSN268201700012B

IDV Type: BPA

Timeline