FDA said to choose speed when buying IT
Officials at the Food and Drug Administration's Center for Drug
Evaluation and Research stressed speed and flexibility when buying
technology, but lacked clearly defined requirements, according to a
report released today.
Officials entered risky contracts, known
as time-and-materials contracts, which pay a company based on labor
hours and reimburses them for materials, the Health and Human Services
Department’s inspector general wrote in the report. That type of
contract doesn’t give a company incentive to control costs, the report
In streamlining its purchases, the center used the
General Services Administration’s Federal Supply Service contracts or
governmentwide acquisition contracts for 27 of 28 information
technology purchases from fiscal 2004 to 2007. These types of contract
vehicles limited competition for the center’s work, the report stated.
center “acquired IT services primarily through flexible acquisition
methods and time-and-material contract actions that reduce the agency’s
administrative burden but increase the risk for the government,” the
As for its planning, officials at the center used
broad language in their work statements to describe IT and services
they intended to buy.
The IG wrote that agencies must lay out
acquisition plans and clearly define what they are buying in a
statement of work. They also must choose an appropriate type of
contract, which doesn't heap the risk on the agency. The Food and Drug
Administration intends to begin identifying and defining IT
requirements early in the process of developing a new system, wrote
Susan Winckler, FDA chief of staff, in a letter to the IG.
IG also recommended that the center convert its time-and-material
contracts to contracts with fixed prices. Fixed-price contracts “would
reduce the financial risk borne by the government and may allow FDA to
obtain the same services at a reduced cost,” the report states.
Winckler agreed to change contract types when appropriate.
center also should use quality assurance plans to check a contractor’s
work and give contractors performance incentives, which would tie the
company’s profits to specific performance standards, the report
Matthew Weigelt is a former FCW senior writer who covered acquisition and procurement.