HHS awarded $20.6M for biological product manufacturing, with a significant portion allocated to a single delivery order

Contract Overview

Contract Amount: $20,628,300 ($20.6M)

Contractor: Sanofi Vaccines US Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2013-09-12

End Date: 2014-03-12

Contract Duration: 181 days

Daily Burn Rate: $114.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: ASPR-13-10041

Place of Performance

Location: SWIFTWATER, MONROE County, PENNSYLVANIA, 18370

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $20.6 million to SANOFI VACCINES US INC. for work described as: ASPR-13-10041 Key points: 1. The contract's value is primarily driven by a large delivery order, suggesting a focused procurement. 2. Competition dynamics appear robust with 5 bidders, potentially leading to favorable pricing. 3. The fixed-price contract type mitigates cost overrun risks for the government. 4. Performance is tied to biological product manufacturing, a critical sector for public health. 5. The contract falls under the 'Other' sector due to its specific product focus, rather than a broader category. 6. The relatively short duration of 181 days indicates a specific, time-bound need.

Value Assessment

Rating: good

The total contract value of $20.6 million is spread across multiple delivery orders, with the largest single order amounting to $11.4 million. Benchmarking against similar contracts for biological product manufacturing is challenging without more specific product details. However, the firm fixed-price nature suggests that the government has locked in costs, which is generally a positive indicator of value, assuming the scope was well-defined. The per-unit cost is not directly calculable from the provided data, but the overall award suggests a significant investment in this specific product.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, with 5 bidders participating. This level of competition is generally favorable for price discovery and ensures that a wide range of potential contractors had the opportunity to bid. The presence of multiple bidders suggests that the market for this type of biological product manufacturing is sufficiently developed to support competitive solicitations. The government likely received a range of proposals, allowing for selection of the best value.

Taxpayer Impact: A competitive process with multiple bidders helps ensure that taxpayer dollars are used efficiently by driving down prices and encouraging innovation among contractors.

Public Impact

The primary beneficiaries are likely public health initiatives requiring the specific biological product manufactured under this contract. The contract facilitates the production of essential biological products, contributing to national health security. The geographic impact is centered around the contractor's facility in Pennsylvania. Workforce implications include employment opportunities within the biological product manufacturing sector at the contractor's site.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price increases if the scope of work expands beyond the initial fixed-price agreement.
Dependence on a single contractor for a critical biological product could pose supply chain risks.
The specific nature of the biological product may limit the pool of qualified manufacturers, impacting future competition.

Positive Signals

The use of full and open competition suggests a healthy market and potential for good pricing.
The firm fixed-price contract type provides cost certainty for the government.
The award to SANOFI VACCINES US INC. indicates a known entity in the vaccine and biological product space.

Sector Analysis

This contract falls within the broader pharmaceutical and biotechnology sector, specifically focusing on the manufacturing of biological products. The market for such products is often characterized by high research and development costs, stringent regulatory requirements, and significant barriers to entry. Government spending in this area is crucial for ensuring the availability of essential medical countermeasures and vaccines. Comparable spending benchmarks would depend heavily on the specific type and quantity of biological product being manufactured.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions for this contract. Given the nature of biological product manufacturing, which often requires specialized facilities and expertise, it is plausible that larger, established firms are the primary participants. Further analysis would be needed to determine if subcontracting opportunities exist for small businesses within the supply chain or support services.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Health and Human Services (HHS), specifically the Office of the Assistant Secretary for Preparedness and Response (ASPR). Mechanisms likely include contract performance monitoring, financial audits, and adherence to regulatory compliance. Transparency is generally maintained through contract databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Strategic National Stockpile
Vaccine and Therapeutic Development Programs
Biodefense and Emerging Infectious Diseases Programs

Risk Flags

Potential for supply chain disruption if contractor faces production issues.
Reliance on a single large delivery order may indicate a concentrated risk.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $20.6 million to SANOFI VACCINES US INC.. ASPR-13-10041

Who is the contractor on this award?

The obligated recipient is SANOFI VACCINES US INC..

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Office of Assistant Secretary for Preparedness and Response).

What is the total obligated amount?

The obligated amount is $20.6 million.

What is the period of performance?

Start: 2013-09-12. End: 2014-03-12.

What is the specific biological product being manufactured under this contract?

The provided data identifies the North American Industry Classification System (NAICS) code as 325414, which corresponds to 'Biological Product (except Diagnostic) Manufacturing'. However, the specific name or type of biological product is not detailed in the given information. This level of specificity is crucial for understanding the contract's purpose, its criticality, and for conducting more precise value and risk assessments. Without this detail, comparisons to other contracts or market benchmarks remain generalized.

How does the largest delivery order ($11.4M) compare to the total contract value ($20.6M) in terms of significance?

The largest single delivery order represents approximately 55% of the total contract value ($11,396,900 / $20,628,300). This indicates that a substantial portion of the contract's funding was allocated to a specific, significant procurement action within the contract's period of performance. It suggests a concentrated need or a major production run for a particular biological product, rather than a steady, distributed requirement across multiple smaller orders. This concentration could imply a critical supply need or a large-scale manufacturing effort.

What is the historical spending pattern for this specific contract vehicle or similar biological product manufacturing contracts by HHS?

The provided data pertains to a single contract award (ASPR-13-10041) with a defined start and end date (September 12, 2013, to March 12, 2014). To assess historical spending patterns, one would need to examine prior and subsequent contracts awarded by HHS, particularly ASPR, for similar biological product manufacturing services. Analyzing trends in award values, competition levels, and contract types over several fiscal years would reveal whether this $20.6 million award is typical, an outlier, or part of a growing/shrinking investment in this area. Without this broader historical context, it's difficult to establish a pattern.

What are the key performance indicators (KPIs) and quality assurance measures associated with this biological product manufacturing contract?

The provided data does not explicitly list the Key Performance Indicators (KPIs) or quality assurance measures for this contract. However, for biological product manufacturing, especially for government contracts related to public health preparedness, stringent quality control and adherence to Good Manufacturing Practices (GMP) are typically paramount. Performance would likely be measured against production timelines, product purity, potency, sterility, and compliance with FDA regulations. The contract type (Firm Fixed Price) implies that meeting these quality standards is a condition of payment, and failure to do so could result in penalties or contract termination.

What is the track record of SANOFI VACCINES US INC. with HHS and other federal agencies for similar manufacturing contracts?

SANOFI VACCINES US INC. is a known entity in the pharmaceutical and vaccine industry. To assess their track record specifically with HHS and other federal agencies for similar manufacturing contracts, a search of federal procurement databases (like FPDS or SAM.gov) would be necessary. This would reveal the number of previous awards, their values, the types of products manufactured, and performance history (e.g., any past performance issues or exceptional ratings). A positive history with federal agencies, particularly HHS, would suggest reliability and capability in meeting government requirements for biological products.

What are the potential risks associated with the firm fixed-price contract type for this specific biological product?

While a firm fixed-price (FFP) contract offers cost certainty to the government, it can introduce risks for the contractor if the scope of work is not perfectly defined or if unforeseen production challenges arise. For biological product manufacturing, these challenges could include raw material price fluctuations, unexpected yields, or complex quality control issues. If the contractor encounters significant cost overruns due to factors beyond their control (and not due to poor performance), they may seek contract modifications or face financial losses. Conversely, if the initial price was set too high, the government might overpay if costs are lower than anticipated.

Industry Classification

NAICS: Manufacturing › Pharmaceutical and Medicine Manufacturing › Biological Product (except Diagnostic) Manufacturing

Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 11100SOL00020

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Sanofi

Address: 1 DISCOVERY DR, SWIFTWATER, PA, 18370

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

Financial Breakdown

Contract Ceiling: $20,628,300

Exercised Options: $20,628,300

Current Obligation: $20,628,300

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HHSO100201200015I

IDV Type: IDC

Timeline