DoD's $25M research support contract awarded to Leidos, Inc. shows fair value with strong competition
Contract Overview
Contract Amount: $25,010,674 ($25.0M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2022-01-07
End Date: 2026-07-19
Contract Duration: 1,654 days
Daily Burn Rate: $15.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: RESEARCH SUPPORT SERVICES
Place of Performance
Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92106
Plain-Language Summary
Department of Defense obligated $25.0 million to LEIDOS, INC. for work described as: RESEARCH SUPPORT SERVICES Key points: 1. Value appears reasonable given the scope of R&D support services. 2. Full and open competition suggests a healthy market for these services. 3. Contract type (Cost Plus Fixed Fee) introduces some cost uncertainty. 4. Performance period spans over 4 years, indicating a long-term need. 5. Contractor is a large, established entity with significant federal experience. 6. Services are categorized under R&D in Physical, Engineering, and Life Sciences. 7. Geographic focus is California, a hub for research and development.
Value Assessment
Rating: good
The contract's total value of approximately $25 million over its duration appears reasonable for specialized research support services. Benchmarking against similar R&D support contracts is challenging without more granular data on specific tasks. However, the fixed fee component suggests a degree of cost control, though the cost-plus nature allows for flexibility in addressing unforeseen research challenges. The contractor's established presence and experience in the federal sector further support the assessment of good value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple capable vendors were likely solicited and submitted proposals. The presence of a single award delivery order suggests that Leidos, Inc. was selected as the most advantageous offer. The high level of competition is generally positive for price discovery and ensures the government can select from a range of qualified providers.
Taxpayer Impact: Full and open competition typically leads to more competitive pricing, benefiting taxpayers by ensuring the government is not overpaying for essential research support services.
Public Impact
Benefits the Department of Defense by providing critical research support. Services delivered include research and development in physical, engineering, and life sciences. Geographic impact is concentrated in California, supporting the state's robust R&D ecosystem. Workforce implications include potential employment for scientists, engineers, and research support staff in California.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus fixed fee contracts can lead to cost overruns if not managed diligently.
- The long performance period could introduce risks related to evolving research needs and technological obsolescence.
- Reliance on a single large contractor may limit future competition or innovation if not carefully monitored.
Positive Signals
- Awarded through full and open competition, indicating a robust market.
- Contractor (Leidos, Inc.) is a well-established entity with a strong track record in federal contracting.
- Services align with critical national defense research objectives.
- The contract is for R&D, a vital area for technological advancement.
Sector Analysis
This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. This sector is characterized by innovation, long-term investment, and often involves complex, specialized services. The market size for R&D support services is substantial, driven by government agencies and private industry investing in scientific advancement. This contract represents a portion of the Department of Defense's broader R&D spending, aimed at maintaining technological superiority.
Small Business Impact
This contract was not set aside for small businesses, and there is no indication of specific subcontracting requirements for small businesses in the provided data. As a large contract awarded to a major federal contractor, the primary impact on the small business ecosystem would be indirect, potentially through opportunities if Leidos, Inc. chooses to subcontract certain specialized tasks. However, without explicit set-aside or subcontracting goals, the direct benefit to small businesses is likely limited.
Oversight & Accountability
Oversight for this contract would primarily reside with the Department of the Navy, a component of the Department of Defense. Accountability measures are typically embedded within the contract terms, including performance standards, reporting requirements, and payment milestones. Transparency is facilitated through contract databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.
Related Government Programs
- Department of Defense Research and Development Contracts
- Federal R&D Support Services
- Cost-Plus Fixed Fee Contracts
- Research and Development in Physical Sciences
- Research and Development in Engineering
- Research and Development in Life Sciences
Risk Flags
- Cost-Plus contract type can lead to cost uncertainty.
- Long performance period may not adapt to rapidly changing R&D needs.
- No explicit small business subcontracting goals mentioned.
Tags
research-and-development, department-of-defense, california, full-and-open-competition, cost-plus-fixed-fee, leidos-inc, delivery-order, physical-sciences, engineering, life-sciences, navy
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $25.0 million to LEIDOS, INC.. RESEARCH SUPPORT SERVICES
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $25.0 million.
What is the period of performance?
Start: 2022-01-07. End: 2026-07-19.
What is Leidos, Inc.'s track record with the Department of Defense and similar R&D contracts?
Leidos, Inc. is a major federal contractor with a significant history of performing work for the Department of Defense across various domains, including IT, logistics, and research support. They have a substantial portfolio of contracts, many of which involve complex technical services and R&D. Their track record generally indicates experience in managing large-scale, multi-year projects. Specific to R&D support, Leidos has been involved in numerous contracts requiring scientific and engineering expertise. While this specific contract is a delivery order under a larger vehicle, Leidos's overall performance history with the DoD suggests a capacity to handle such requirements. However, a deeper dive into past performance reviews and any past issues on similar contracts would provide a more complete picture of their reliability and effectiveness in this specific area.
How does the pricing structure (Cost Plus Fixed Fee) compare to other R&D support contracts?
The Cost Plus Fixed Fee (CPFF) pricing structure is common for research and development contracts where the scope of work can be uncertain or evolve. In a CPFF contract, the contractor is reimbursed for allowable costs plus a fixed fee representing profit. This structure aims to balance flexibility for the government in adapting to research needs with contractor incentive to control costs, as the fee is fixed. Compared to other R&D contracts, CPFF offers more flexibility than Firm-Fixed-Price (FFP) but less cost certainty for the government than FFP. It is generally considered more expensive than FFP due to the inherent risk transfer to the government. However, for highly innovative or exploratory research where precise cost estimation is difficult, CPFF is often preferred over FFP. Other structures like Cost Plus Incentive Fee (CPIF) might offer better cost control incentives.
What are the primary risks associated with this contract, and how are they mitigated?
The primary risks associated with this contract include potential cost overruns due to the CPFF structure, scope creep if research objectives are not clearly defined and managed, and technological obsolescence if the research does not yield timely or relevant results. Mitigation strategies typically involve robust contract management by the government, including detailed performance monitoring, regular reviews of cost expenditures against the budget, and clear definition and control of the Statement of Work (SOW). The fixed fee component provides some incentive for the contractor to manage costs efficiently. Furthermore, the long duration necessitates proactive management to ensure the research remains aligned with evolving defense needs. The government's ability to exercise options or terminate for convenience also serves as a risk mitigation tool.
How effective is the competition level in ensuring value for money for taxpayers?
The 'full and open competition' award strategy is generally considered the most effective method for ensuring value for money for taxpayers in federal contracting. It allows any responsible source to submit a bid, fostering a competitive environment where multiple companies vie for the contract. This competition drives down prices, encourages innovation, and ensures that the government selects the offer that provides the best overall value, considering factors like price, technical approach, and past performance. In this case, the fact that the contract was awarded under this broad competition suggests that the government received competitive proposals, and the selected offer from Leidos, Inc. was deemed the most advantageous. This process inherently promotes price discovery and reduces the likelihood of overpayment compared to sole-source or limited competition awards.
What is the historical spending pattern for similar research support services within the Department of Defense?
Historical spending on research support services within the Department of Defense (DoD) is substantial and consistently represents a significant portion of the agency's budget. The DoD is a major investor in R&D across various scientific and engineering disciplines to maintain technological superiority. Spending in this category typically fluctuates based on strategic priorities, emerging threats, and technological advancements. Contracts for R&D support services, like the one awarded to Leidos, Inc., are common and can range from basic research to applied research and development. Analyzing historical spending patterns for similar contracts (e.g., by NAICS code 541712) would reveal trends in contract values, durations, and the types of services procured. This specific contract's value of approximately $25 million over roughly 4.5 years falls within a typical range for significant R&D support efforts, reflecting the ongoing investment in this critical area.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
Product/Service Code: RESEARCH AND DEVELOPMENT › N – Health R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 1750 PRESIDENTS ST FL 4, 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: $46,706,872
Exercised Options: $38,225,438
Current Obligation: $25,010,674
Actual Outlays: $508,900
Subaward Activity
Number of Subawards: 53
Total Subaward Amount: $4,168,663
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: GS00Q14OADU420
IDV Type: IDC
Timeline
Start Date: 2022-01-07
Current End Date: 2026-07-19
Potential End Date: 2026-07-19 00:00:00
Last Modified: 2025-05-22
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