Leidos awarded $31.5M for R&D services, with a significant portion allocated to research in physical, engineering, and life sciences
Contract Overview
Contract Amount: $31,465,874 ($31.5M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2018-09-27
End Date: 2021-09-26
Contract Duration: 1,095 days
Daily Burn Rate: $28.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: SUPPLIES AND SERVICES
Place of Performance
Location: PICATINNY ARSENAL, MORRIS County, NEW JERSEY, 07806
Plain-Language Summary
Department of Defense obligated $31.5 million to LEIDOS, INC. for work described as: SUPPLIES AND SERVICES Key points: 1. The contract value of $31.5 million for R&D services suggests a substantial investment in specialized scientific and technical capabilities. 2. Competition dynamics for this contract were characterized by full and open competition, indicating a broad market approach. 3. The contract type, Cost Plus Fixed Fee, can introduce cost escalation risks if not managed diligently. 4. Performance is situated within New Jersey, a region with a notable presence of R&D and technology firms. 5. The primary NAICS code, 541712, points to a focus on research and development across physical, engineering, and life sciences, excluding biotechnology. 6. The contract duration of 1095 days (3 years) allows for sustained effort on complex research objectives.
Value Assessment
Rating: fair
The contract value of $31.5 million for a three-year R&D effort appears within a reasonable range for specialized scientific services. However, without specific benchmarks for the exact nature of the R&D, a precise value-for-money assessment is challenging. The Cost Plus Fixed Fee (CPFF) contract type, while allowing flexibility, can lead to higher overall costs compared to fixed-price contracts if contractor efficiencies are not rigorously monitored. Benchmarking against similar R&D contracts for comparable scientific disciplines would provide a clearer picture of pricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting that multiple bidders had the opportunity to submit proposals. This approach typically fosters a competitive environment, potentially leading to better pricing and innovative solutions. The number of bidders is not specified, but the 'full and open' designation implies a robust competition.
Taxpayer Impact: Full and open competition generally benefits taxpayers by promoting a wider range of offers and potentially driving down costs through market forces, ensuring that the government receives competitive pricing for its research and development investments.
Public Impact
The primary beneficiaries are likely the Department of the Army and potentially other government entities requiring advanced research and development in physical, engineering, and life sciences. The services delivered encompass research and development activities, contributing to advancements in scientific and technological fields. The geographic impact is centered in New Jersey, supporting the local economy through contract performance and potential job creation in the R&D sector. Workforce implications include the employment of scientists, engineers, and technical personnel required to conduct the research.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee contract type may lead to cost overruns if not managed effectively.
- Lack of specific details on performance metrics makes it difficult to assess the effectiveness of the R&D outcomes.
- The broad NAICS code for R&D could encompass a wide range of activities, making it hard to pinpoint specific risks without further detail.
Positive Signals
- Awarded under full and open competition, indicating a competitive bidding process.
- The contract duration allows for sustained effort on potentially complex research projects.
- Leidos, Inc. is a large, established government contractor with a broad range of capabilities.
Sector Analysis
The contract falls within the Research and Development (R&D) sector, specifically focusing on physical, engineering, and life sciences (excluding biotechnology). This sector is characterized by innovation, long development cycles, and significant government investment. Comparable spending benchmarks would depend heavily on the specific sub-disciplines of R&D being pursued, but overall federal R&D spending is in the hundreds of billions annually. This contract represents a small fraction of that total, likely supporting a specific program objective within the Department of Defense.
Small Business Impact
The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a result, small businesses are unlikely to be direct prime contractors. However, there may be opportunities for small businesses to participate as subcontractors to Leidos, Inc., depending on the specific research tasks and Leidos's subcontracting strategy. The impact on the broader small business ecosystem would be minimal unless significant subcontracting opportunities arise.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and the program office within the Department of the Army. Accountability measures would be tied to the contract's performance clauses and reporting requirements. Transparency is generally facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise.
Related Government Programs
- Department of Defense Research and Development
- Scientific and Technical Services
- Engineering Services
- Life Sciences Research
- Physical Sciences Research
Risk Flags
- Cost Plus Fixed Fee contract type requires diligent oversight to manage potential cost overruns.
- The broad scope of NAICS 541712 necessitates clear performance metrics to ensure R&D objectives are met.
- Lack of specific details on the number of bidders in a full and open competition limits assessment of competitive intensity.
Tags
research-and-development, department-of-defense, department-of-the-army, cost-plus-fixed-fee, full-and-open-competition, new-jersey, scientific-services, engineering-services, life-sciences, physical-sciences, delivery-order
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $31.5 million to LEIDOS, INC.. SUPPLIES AND 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 Army).
What is the total obligated amount?
The obligated amount is $31.5 million.
What is the period of performance?
Start: 2018-09-27. End: 2021-09-26.
What is Leidos, Inc.'s track record with Cost Plus Fixed Fee (CPFF) contracts, particularly within the Department of Defense?
Leidos, Inc. has a substantial history of performing on Cost Plus Fixed Fee (CPFF) contracts across various federal agencies, including the Department of Defense. CPFF contracts are common for research and development efforts where the scope of work can evolve, and precise costs are difficult to predict upfront. While CPFF contracts offer flexibility, they also carry inherent risks of cost overruns if not managed with stringent oversight and performance monitoring. Leidos's extensive experience suggests they have established processes for managing such contracts, but the success of any CPFF contract ultimately depends on the specific project's complexity, the clarity of objectives, and the effectiveness of the government's oversight in controlling costs and ensuring value.
How does the $31.5 million contract value compare to other R&D contracts in the physical, engineering, and life sciences sectors awarded by the Department of the Army?
The $31.5 million contract value for a three-year R&D effort in physical, engineering, and life sciences is a moderate-sized award within the Department of the Army's R&D portfolio. The Army invests billions annually in R&D, encompassing a wide spectrum of projects from basic research to advanced technology development. Contracts of this magnitude are typical for supporting specific research initiatives or technology maturation efforts. Larger contracts, often in the hundreds of millions, are usually reserved for major system development or large-scale, multi-year programs. Smaller contracts, in the single-digit millions, might fund more focused studies or early-stage research. Therefore, this award sits comfortably within the typical range for specialized R&D services.
What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D services?
The primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D services revolve around cost control and contractor incentive. For the government, the main risk is potential cost escalation, as the contractor is reimbursed for allowable costs plus a fixed fee. If costs exceed initial estimates, the government pays more. This necessitates robust oversight to ensure costs are reasonable and allocable. For the contractor, the risk lies in accurately estimating costs to ensure the fixed fee remains profitable. If costs are underestimated, the fee might not adequately compensate for the effort. Additionally, CPFF contracts can sometimes reduce the contractor's incentive to control costs aggressively compared to fixed-price contracts, as their profit is fixed regardless of the final cost. Effective management requires clear performance metrics and diligent cost tracking.
What does the NAICS code 541712 (Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)) imply about the specific nature of the R&D performed?
The NAICS code 541712 signifies that the research and development activities under this contract are focused on fundamental and applied research in disciplines such as physics, chemistry, materials science, mechanical engineering, electrical engineering, civil engineering, environmental engineering, and various biological sciences (excluding those specifically classified under biotechnology). This broad classification suggests the contract could support a wide array of projects, from developing new materials or energy solutions to improving engineering processes or understanding complex biological systems. The exclusion of biotechnology means that research directly related to genetic engineering, recombinant DNA technology, or related biopharmaceutical development is likely not the primary focus, though overlap may exist in areas like bioinformatics or biophysics.
Given the 'full and open competition' award type, what can be inferred about the potential for innovation and cost savings?
A 'full and open competition' award type suggests that the government solicited proposals from all responsible sources, maximizing the pool of potential offerors. This broad competition is generally considered a positive indicator for both innovation and cost savings. By allowing any interested and qualified company to bid, the government increases the likelihood of receiving diverse approaches and novel solutions to the stated requirements. Furthermore, a larger number of bidders typically intensifies price competition, which can drive down the overall cost of the contract. While the specific number of bidders isn't provided, the designation itself implies a market where multiple entities could compete, fostering an environment conducive to both technological advancement and fiscal prudence for the taxpayer.
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 › OTHER RESEARCH/DEVELOPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: W911NF15R0004
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc.
Address: 11951 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: $39,554,634
Exercised Options: $39,554,634
Current Obligation: $31,465,874
Subaward Activity
Number of Subawards: 97
Total Subaward Amount: $13,812,211
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: W911NF15D0014
IDV Type: IDC
Timeline
Start Date: 2018-09-27
Current End Date: 2021-09-26
Potential End Date: 2021-09-26 00:00:00
Last Modified: 2025-12-31
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