Department of Health and Human Services

OFFICE OF 

INSPECTOR GENERAL 

 

Daniel R. Levinson 

Inspector General 

January 2009 

OEI-01-07-00450 

 

MANAGEMENT OF INFORMATION TECHNOLOGY 

CONTRACTS AT 

THE FOOD AND DRUG ADMINISTRATION’S 

CENTER FOR DRUG EVALUATION AND RESEARCH
Office of Inspector General 

http://oig.hhs.gov 

The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as 

amended, is to protect the integrity of the Department of Health and Human Services 

(HHS) programs, as well as the health and welfare of beneficiaries served by those 

programs. This statutory mission is carried out through a nationwide network of audits, 

investigations, and inspections conducted by the following operating components: 

Office of Audit Services 

The Office of Audit Services (OAS) provides auditing services for HHS, either by conducting 

audits with its own audit resources or by overseeing audit work done by others. Audits 

examine the performance of HHS programs and/or its grantees and contractors in carrying 

out their respective responsibilities and are intended to provide independent assessments of 

HHS programs and operations. These assessments help reduce waste, abuse, and 

mismanagement and promote economy and efficiency throughout HHS. 

Office of Evaluation and Inspections 

The Office of Evaluation and Inspections (OEI) conducts national evaluations to provide 

HHS, Congress, and the public with timely, useful, and reliable information on significant 

issues. These evaluations focus on preventing fraud, waste, or abuse and promoting 

economy, efficiency, and effectiveness of departmental programs. To promote impact, OEI 

reports also present practical recommendations for improving program operations. 

Office of Investigations 

The Office of Investigations (OI) conducts criminal, civil, and administrative investigations 

of fraud and misconduct related to HHS programs, operations, and beneficiaries. With 

investigators working in all 50 States and the District of Columbia, OI utilizes its resources 

by actively coordinating with the Department of Justice and other Federal, State, and local 

law enforcement authorities. The investigative efforts of OI often lead to criminal 

convictions, administrative sanctions, and/or civil monetary penalties. 

Office of Counsel to the Inspector General 

The Office of Counsel to the Inspector General (OCIG) provides general legal services to 

OIG, rendering advice and opinions on HHS programs and operations and providing all 

legal support for OIG’s internal operations. OCIG represents OIG in all civil and 

administrative fraud and abuse cases involving HHS programs, including False Claims Act, 

program exclusion, and civil monetary penalty cases. In connection with these cases, OCIG 

also negotiates and monitors corporate integrity agreements. OCIG renders advisory 

opinions, issues compliance program guidance, publishes fraud alerts, and provides other 

guidance to the health care industry concerning the anti-kickback statute and other OIG 

enforcement authorities. 
Δ EXECUTIVE SUMMARY 

OBJECTIVES

1. To assess the Food and Drug Administration’s (FDA) Center for Drug 

Evaluation and Research (CDER) process for selecting information 

technology (IT) contractors from fiscal year (FY) 2004 to FY 2007. 

2. To determine the extent to which CDER monitored the performance 

of its IT contractors from FY 2004 to FY 2007. 

BACKGROUND 

In FY 2006, the Department of Health and Human Services spent 

$5.4 billion on IT. Overall, Federal spending on IT has long been 

considered high risk for fraud, waste, and abuse because of the 

significant cost involved and insufficient planning on the part of Federal 

agencies. 

The Office of Inspector General conducted a review of the IT contracting 

practices of FDA’s CDER at the request of the Senate Committee on 

Finance. The request was in response to a draft consulting report that 

raised questions about the management of CDER’s IT contracts. The 

Office of Information Technology was responsible for planning and 

managing many of the IT services for CDER. The Federal Acquisition 

Regulation (FAR) governs how all Federal agencies, including FDA, may 

acquire supplies and services with appropriated funds. 

Agencies must establish procedures to select qualified contractors while 

protecting the Government from unnecessary financial risk. To ensure 

that contracted work is performed efficiently and funds are used 

effectively, agencies must perform acquisition planning, clearly define 

what they are buying in a statement of work, and select an appropriate 

contract type and method. Agencies may use several types of contracts 

to acquire supplies and services. One such type is time-and-materials, 

whereby the Government pays the contractor a fixed amount for hourly 

labor and generally reimburses it for any costs of materials. In 

addition, agencies must use performance-based contracting for a 

designated proportion of contracts to encourage contractors to focus on 

achieving specific outcomes. With limited exceptions, agencies must 

provide for full and open competition. Once contracted work begins, 

agencies must monitor contractors to ensure quality results. 

OEI-01-07-00450 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER i 
 

 

EXECUTIVE SUMMARY 

We reviewed the contractor selection, performance measurement and 

quality assurance (QA) plans, and the performance monitoring for 

28 CDER OIT contract actions. We also interviewed five current or 

former CDER contract project officers. 

FINDINGS 

CDER’s contract actions demonstrated limited IT planning and 

increased risk for the Government. CDER used broad language to 

describe requirements in its statements of work, allowing it to specify 

its requirements over time. CDER relied primarily on acquisition 

methods that emphasize speed and flexibility over planning. CDER also 

relied on time-and-materials contract actions that increase risk for the 

Government. Because of these decisions, CDER may not achieve the 

benefits of performance-based acquisition. 

CDER used quality assurance and monitoring plans inconsistently. 

Because CDER did not clearly define its requirements or performance 

measures, it also did not establish QA plans consistently. Twenty-one of 

twenty-eight contract actions reviewed did not have documented QA 

plans. Of the seven contract actions that included QA plans, three 

contained identical plans with generic language calling for 100-percent 

inspection of deliverables using the same checklist of qualitative 

measures. 

RECOMMENDATIONS 

Several areas of concern exist with CDER’s IT planning process and its 

contract monitoring. Although the IT contract actions reviewed were 

generally compliant with the FAR, FDA could minimize its contract risk 

by making the following changes: 

Define IT requirements more clearly. FDA should revise its planning 

processes to define IT requirements in greater detail. This step could lead 

to additional contracting options and create greater efficiencies in 

contractor selection and project management as well. 

Convert ongoing time-and-materials contract actions to fixed-price contract 

actions when appropriate. Converting ongoing time-and-materials contract 

actions to fixed-price contract actions would reduce the financial risk 

borne by the Government and may allow FDA to obtain the same services 

at a reduced cost. Converting time-and-materials contract actions to 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER ii 
 

 

EXECUTIVE SUMMARY 

fixed-price contract actions would also reduce the amount of oversight 

needed to ensure labor efficiency. 

Use performance incentive plans when appropriate. Use of performance 

incentives could allow FDA to reduce contract costs by tying the 

contractor’s profit or award fees to quantifiable performance standards. 

Use documented QA plans. Implementing documented QA plans in its 

contract actions would allow FDA to create a mechanism for contractor 

accountability by identifying services that do not meet defined 

requirements. 

AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL 

RESPONSE

FDA agreed with three of our four recommendations and identified 

steps it is taking to implement them. FDA neither agreed nor disagreed 

with our first recommendation to define its IT requirements more 

clearly. However, it did identify actions it is taking that support that 

recommendation. In addition, FDA agreed with our other 

recommendations to convert time-and-materials contracts to fixed-price 

contracts when appropriate and to use performance incentives and 

quality assurance plans when applicable. We ask that in its final 

management decision, FDA more clearly indicate whether it concurs 

with our first recommendation and what steps it will take to 

implement it. 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER iii 
 

 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER iv 

EXECUTIVE SUMMARY .....................................i

INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 

CONTRACTING PRIMER ...................................7

FINDINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 

 Limited planning and increased risk.. . . . . . . . . . . . . . . . . . . . . . . . . 10 

 Inconsistent quality assurance and monitoring. . . . . . . . . . . . . . . . . 13 

RECOMMENDATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 

 Agency Comments and Office of Inspector General Response . . . . 16 

APPENDIXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 

 A: Glossary of Abbreviations, Acronyms, and Contracting Terms . . 18 

 B: Legal Authorities Governing Federal Acquisitions . . . . . . . . . . . 20 

 C: Agency Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 

 

ACKNOWLEDGMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Δ TABLE OF CONTENTS 
 

 

Δ INTRODUCTION 

OBJECTIVES 

1. To assess the Food and Drug Administration’s (FDA) Center for Drug 

Evaluation and Research (CDER) process for selecting information 

technology (IT) contractors from fiscal year (FY) 2004 to FY 2007. 

2. To determine the extent to which CDER monitored the performance 

of its IT contractors from FY 2004 to FY 2007. 

BACKGROUND 

In FY 2006, the Department of Health and Human Services (HHS) 

spent $5.4 billion on IT.1 Overall, Federal spending on IT has long been 

considered high risk for fraud, waste, and abuse because of the 

significant cost involved and insufficient planning on the part of Federal 

agencies. In 1996, Congress passed the Clinger-Cohen Act to improve 

the way Federal agencies acquire and manage IT services.2 The Act 

requires agencies to develop best practices for the acquisition of 

commercial IT services and to monitor contracted IT services through 

performance measurement.3 Despite these efforts, IT contracting 

remains a high-risk area for the Federal Government.4 

The Office of Inspector General conducted a review of the IT contracting 

practices of FDA’s CDER at the request of the Senate Committee on 

Finance. The request was in response to a draft consulting report that 

raised questions about the management of CDER’s IT contracts. The 

draft report specifically addressed CDER’s management of an IT project 

called the Adverse Event Reporting System II.5 This system was 

intended to be a database for collecting adverse event information for 

prescription drugs. The draft report indicated that CDER’s Office of 

Information Technology (OIT) mismanaged the project, resulting in cost 

overruns and decreased productivity. The draft report also questioned 

OIT’s contractor selection and management processes. 

1 Office of Management and Budget, “Report on Information Technology Spending for the 

Federal Government,” May 2007. 

2 P.L. 104-106, Div. E (1996); 40 U.S.C. § 11101 et seq. 

3 40 U.S.C. §§ 11302(f), 11313. 

4 For example, see United States Government Accountability Office (GAO), “High-Risk 

Series: Information Management and Technology,” GAO/HR-97-9, February 1997. See also 

GAO, “Information Technology: Further Improvements Needed to Identify and Oversee 

Poorly Planned and Performing Projects,” GAO-07-1211T, September 20, 2007. 

5 Breckenridge Institute, “Independent Verification and Validation of AERS II 

Requirements Process,” November 2006. 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 1 
 

I N T R O D U C T I O N 

CDER is responsible for ensuring that drugs marketed within the 

United States are safe and effective. This responsibility begins in the 

research and development stage of a potential drug and continues 

throughout the life of a marketed drug. In keeping with its mission, 

CDER receives large amounts of electronic information, such as clinical 

trial data and adverse event reports. It is critical that CDER procure IT 

systems and services that meet its needs in a cost-effective manner, 

while also complying with relevant acquisition regulations. 

CDER is responsible for ensuring that drugs marketed within the 

United States are safe and effective. This responsibility begins in the 

research and development stage of a potential drug and continues 

throughout the life of a marketed drug. In keeping with its mission, 

CDER receives large amounts of electronic information, such as clinical 

trial data and adverse event reports. It is critical that CDER procure IT 

systems and services that meet its needs in a cost-effective manner, 

while also complying with relevant acquisition regulations. 

CDER IT Planning and Contracting Processes 

OIT was responsible for planning and managing many of the IT services 

for CDER.6 As of May 2008, OIT had 40 staff members across three 

branches: Enterprise Architecture, Application Development, and 

Quality Assurance. OIT and its counterparts from the other FDA 

centers were disbanded and absorbed at the end of FY 2008 into one 

agencywide Office of Information Management. 

OIT was responsible for planning and managing many of the IT services 

for CDER.6 As of May 2008, OIT had 40 staff members across three 

branches: Enterprise Architecture, Application Development, and 

Quality Assurance. OIT and its counterparts from the other FDA 

centers were disbanded and absorbed at the end of FY 2008 into one 

agencywide Office of Information Management. 

Prior to the reorganization, CDER components worked with OIT to 

develop and implement new IT systems. When CDER identified an IT 

need, such as new software, hardware, or support, it worked with OIT to 

develop a proposal for CDER’s Information Management Steering 

Committee’s Planning Subcommittee (the Planning Subcommittee).7 

OIT conducted various analyses to include with the proposal, and 

determined whether it had the expertise to meet each IT request with 

internal resources or whether it would need to hire a contractor.8 

Prior to the reorganization, CDER components worked with OIT to 

develop and implement new IT systems. When CDER identified an IT 

need, such as new software, hardware, or support, it worked with OIT to 

develop a proposal for CDER’s Information Management Steering 

Committee’s Planning Subcommittee (the Planning Subcommittee).7 

OIT conducted various analyses to include with the proposal, and 

determined whether it had the expertise to meet each IT request with 

internal resources or whether it would need to hire a contractor.8 

If the proposal was approved by the Planning Subcommittee and OIT 

decided to hire a contractor, OIT staff worked with FDA’s Office of 

Acquisition and Grant Services (the Acquisition Office). The Acquisition 

Office administers contracts for all of FDA, including CDER.9 Only 

contracting officers within the Acquisition Office have the authority to 

enter into, administer, or terminate a contract on behalf of FDA.10 

Project officers from OIT provide technical expertise to the Acquisition 

Office and monitor the contractor to ensure that CDER receives what it 

If the proposal was approved by the Planning Subcommittee and OIT 

decided to hire a contractor, OIT staff worked with FDA’s Office of 

Acquisition and Grant Services (the Acquisition Office). The Acquisition 

Office administers contracts for all of FDA, including CDER.9 Only 

contracting officers within the Acquisition Office have the authority to 

enter into, administer, or terminate a contract on behalf of FDA.10 

Project officers from OIT provide technical expertise to the Acquisition 

Office and monitor the contractor to ensure that CDER receives what it 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 2 

6 FDA’s Office of the Chief Information Officer plans and manages cross-center IT 

services. Some services used by CDER are not managed by OIT, such as data entry. This 

review will focus on IT services planned and managed by CDER’s OIT exclusively. 

7 The planning subcommittee is also called the Information Management Advisory 

Board. 

8 HHS, FDA, CDER, “Manual of Policies and Procedures,” MAPP 7600.9, Information 

Management Steering Committee Planning Subcommittee, March 4, 2005, p. 6. 

9 The Acquisition Office will continue this role after the reorganization. 

10 48 CFR § 1.602-1(a). 
 

INTRODUCTION 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 3 

has paid for, while also ensuring that it complies with the Federal 

Acquisition Regulation (FAR).11 

Contracting Basics 

In FY 2006, the Government bought over $400 billion worth of goods 

and services.12 The FAR governs how all Federal agencies, including 

FDA, acquire supplies and services with appropriated funds.13 Agencies 

also promulgate their own regulations as needed to supplement the 

FAR. In addition to the FAR, FDA acquisitions must conform to 

regulations set forth in the HHS Acquisition Regulation and the FDA 

Acquisition Operating Instructions.14

In FY 2006, the Government bought over $400 billion worth of goods 

and services.12 The FAR governs how all Federal agencies, including 

FDA, acquire supplies and services with appropriated funds.13 Agencies 

also promulgate their own regulations as needed to supplement the 

FAR. In addition to the FAR, FDA acquisitions must conform to 

regulations set forth in the HHS Acquisition Regulation and the FDA 

Acquisition Operating Instructions.14

To comply with the FAR, agencies must establish procedures to select 

qualified contractors while protecting the Government from 

unnecessary financial risk. To ensure that contracted work is 

performed efficiently and funds are used effectively, agencies must 

perform acquisition planning,15 clearly define what they are buying in 

the requirements section of a statement of work,16 and select an 

appropriate contract type and method.17 In addition, agencies must use 

performance-based contracting for a designated proportion of contracts 

to encourage contractors to focus on achieving specific outcomes.18 With 

limited exceptions, agencies must provide for full and open competition 

when acquiring goods and services.19 Once performance begins, 

agencies must monitor contractors to ensure quality results.20 

To comply with the FAR, agencies must establish procedures to select 

qualified contractors while protecting the Government from 

unnecessary financial risk. To ensure that contracted work is 

performed efficiently and funds are used effectively, agencies must 

perform acquisition planning,15 clearly define what they are buying in 

the requirements section of a statement of work,16 and select an 

appropriate contract type and method.17 In addition, agencies must use 

performance-based contracting for a designated proportion of contracts 

to encourage contractors to focus on achieving specific outcomes.18 With 

limited exceptions, agencies must provide for full and open competition 

when acquiring goods and services.19 Once performance begins, 

agencies must monitor contractors to ensure quality results.20 

For more information on contracting regulations and terminology, see 

the Contracting Primer starting on page 7. See Appendix A for 

abbreviations and acronyms used in this report and Appendix B for 

legal authorities governing Federal acquisitions. 

For more information on contracting regulations and terminology, see 

the Contracting Primer starting on page 7. See Appendix A for 

abbreviations and acronyms used in this report and Appendix B for 

legal authorities governing Federal acquisitions. 

11 48 CFR § 302.1. 

12 Trending Analysis Report Since Fiscal Year 2000. Available online at: 

http://www.fpdsng.com/downloads/top_requests/FPDSNG/5YearViewOnTotals.xls. 

Accessed May 30, 2008. 

13 The FAR, located at 48 CFR ch.1, is authorized by the Office of Federal Procurement 

Policy Act of 1974, as amended. 41 U.S.C. § 405a. 

14 HHS Acquisition Regulation, 48 CFR ch. 3; FDA, “Acquisition Operating 

Instructions,” on file at FDA. 

15 FAR § 7.102(a)–(b). 

16 Ibid., § 11.002(a). 

17 Ibid., § 16.104. 

18 Office of Management and Budget, “Fiscal Year 2008 Performance-Based Acquisition 

Performance Goal,” December 5, 2007. 

19 FAR, § 6.101. 

20 Ibid., §§ 46.102, 46.103. 
 

INTRODUCTION 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 4 

Acquisition Advisory Panel Report 

The Services Acquisition Reform Act of 2003 created the Acquisition 

Advisory Panel (AAP) to review Federal acquisition laws and 

regulations and make recommendations to improve contracting 

practices.21 Its January 2007 report highlighted problems within 

Federal contracting, including: 

The Services Acquisition Reform Act of 2003 created the Acquisition 

Advisory Panel (AAP) to review Federal acquisition laws and 

regulations and make recommendations to improve contracting 

practices.21 Its January 2007 report highlighted problems within 

Federal contracting, including: 

• the Government’s failure to adequately define its service 

requirements, which leads to a reliance on time-and-materials 

contracts22 and reduces the benefits of competition;23

• the Government’s failure to adequately define its service 

requirements, which leads to a reliance on time-and-materials 

contracts22 and reduces the benefits of competition;23

• the importance of defining service requirements to obtain the 

maximum benefit of performance-based acquisitions concepts;24

and 

• the importance of defining service requirements to obtain the 

maximum benefit of performance-based acquisitions concepts;24

and 

• the acquisition workforce’s challenges in writing performance 

measures and metrics25 and its insufficient surveillance of 

multiagency contracts.26

• the acquisition workforce’s challenges in writing performance 

measures and metrics25 and its insufficient surveillance of 

multiagency contracts.26

Recent United States Government Accountability Office Report 

A recent GAO report demonstrates the same problems with Federal 

contracting that were highlighted in the AAP report. GAO’s review of 

the Department of Defense’s use of time-and-materials contracts found 

that the Department uses them because they can be awarded quickly 

and can be adjusted if requirements change. GAO also found that the 

Department’s monitoring of time-and-materials contracts was not 

sufficient given the inherent risks of this contract type.27

A recent GAO report demonstrates the same problems with Federal 

contracting that were highlighted in the AAP report. GAO’s review of 

the Department of Defense’s use of time-and-materials contracts found 

that the Department uses them because they can be awarded quickly 

and can be adjusted if requirements change. GAO also found that the 

Department’s monitoring of time-and-materials contracts was not 

sufficient given the inherent risks of this contract type.27

21 National Defense Authorization Act for Fiscal Year 2004, P.L. No. 108-136, § 1423 

(2003). 

22 AAP, “Report of the Acquisition Advisory Panel to the Office of Federal Procurement 

Policy and the United States Congress,” January 2007, pp. 7 and 92. 

23 Ibid., pp. 7 and 92. 

24 Ibid., p. 8. 

25 Ibid., p. 178. 

26 Ibid., p. 93. 

27 GAO, “Defense Contracting: Improved Insight and Controls Needed over DoD’s 

Time-and-Materials Contracts,” GAO-07-273, June 2007. 
 

INTRODUCTION 

METHODOLOGY 

Scope 

We reviewed CDER’s contract actions for IT purchases valued at 

$250,000 or more issued from FY 2004 to FY 2007. The contract actions 

covered a range of IT services from upgrading and operating IT systems 

to migrating legacy IT systems into new ones. For each contract action, 

we included the value of all options and modifications. We used the 

Federal Procurement Data System to collect additional information and 

confirm the maximum dollar value. 

Our final review consisted of 28 contract actions. Of these 28 actions, 

19 were delivery orders generated from three blanket purchase 

agreements (BPAs).28 We excluded contract actions that were not 

overseen by CDER OIT. 

Data Sources and Analysis 

Review of Office of Information Technology contract actions. For the 28 

contract actions reviewed, we reviewed elements of the contract files to 

determine the extent to which CDER and the Acquisition Office used 

full and open competition as prescribed by the FAR. For those actions 

that were competed, we also examined the criteria that CDER used to 

evaluate prospective contractors and determined how these criteria 

were weighed during the selection process. 

In determining the extent to which CDER monitored the performance of 

its IT contractors, we reviewed performance measurement and quality 

assurance (QA) plans that were written into the contract actions. We 

also reviewed evidence of CDER’s monitoring activities and determined 

the extent to which CDER monitored contract actions after they were 

awarded. 

Interviews with Center for Drug Evaluation and Research project officers. We 

interviewed five current or former CDER project officers to obtain 

additional background information on specific contract actions, the 

28 We note that the FAR defines “delivery order” to mean a contract action for products 

and “task order” to mean a contract action for services. FAR § 2.101. Although our sample 

contract actions included mostly task orders for services, we sometimes use the term 

“delivery order” to refer to these contract actions because FDA’s Acquisition Office used this 

term and the documents are labeled as “delivery orders.” 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 5 
 

 

INTRODUCTION 

contract-monitoring process, and any challenges that they faced in 

carrying out their duties. 

Limitations 

We did not assess the qualifications of the contractors that CDER 

selected or the technology solutions that they provided. 

Standards 

We conducted this review in accordance with the “Quality Standards for 

Inspections” issued by the President’s Council on Integrity and 

Efficiency and the Executive Council on Integrity and Efficiency. 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 6 
 

 

Δ CONTRACTING PRIMER 

Overview 

The FAR and applicable agency-specific supplements govern purchases 

of supplies or services using appropriated funds. Pursuant to these 

regulations and other applicable authorities, agencies must generally: 

• provide for full and open competition when awarding contracts; 

• select contractors based on objective evaluation factors; and 

• conduct contract monitoring, including establishing a QA plan and 

ensuring that the contractors comply with the plans and any 

deadlines. 

Additionally, legal authorities have established a preference for 

performance-based acquisition (PBA) of services. Although the 

Government previously dictated how contractors should perform their 

work, PBA requires Federal agencies to state their requirements in 

terms of desired outcomes or results and allows the contractors to 

perform the work in any manner they deem appropriate. To ensure that 

outcomes are achieved, PBA contracts must contain measurable 

performance standards by which to assess the contractors’ work and 

performance incentives. 

Acquisition Methods 

Various acquisition methods are available to Federal agencies. 

Specifically, agencies may acquire supplies and services by: 

1. Awarding a new stand-alone contract directly to a vendor and 

administering it. Generally, this method requires the greatest 

administrative burden because the agency must perform market 

research to, among other things, identify qualified contractors; to 

conduct a competition; and to evaluate proposals or quotes. 

Agencies are then obligated to administer the contract. 

2. Ordering directly under an existing contract established by another 

agency. These contracts, called multiagency contracts or 

governmentwide acquisition contracts, often require the ordering 

agency to pay an additional fee for contract use. The main benefit of 

using this method is a decreased administrative burden associated 

with the contract award process. 

3. Ordering from the General Services Administration’s (GSA) Federal 

Supply Schedule (FSS) program. Under FSS, contractors do not 

compete directly against each other in obtaining the initial contract 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 7 
 

 

CONTRACTING PRIMER 

award. Instead, GSA negotiates pricing and terms with FSS vendors 

that provide commercial goods and services based on the vendors’ 

own pricing to their commercial customers. Agencies may then place 

orders under these FSS contracts. FSS orders are considered to be 

fully competed if agencies follow certain ordering procedures 

specified by regulation. 

Contract Types 

The contract type establishes the performance obligations of the 

contractor and the payment obligations of the Government. Agencies 

may use several types of contracts to acquire supplies or services, 

including: 

• Time-and-materials contracts. Under this contract type, the 

Government pays the contractor a fixed amount for hourly labor 

(including wages, overhead, and profit) and generally reimburses for 

any costs of materials. These contracts, which specify a maximum 

dollar amount (ceiling price), may be used only when it is not 

possible to reasonably estimate the extent or duration of work or its 

costs. These contracts provide no incentive for the contractor to 

control costs or ensure labor efficiency and therefore require 

monitoring to ensure that efficient methods and effective cost 

controls are used. 

• Cost-reimbursement contracts. Under a cost-reimbursement contract, 

the Government reimburses the contractor for its allowable costs, 

including labor and materials. The contractor has no incentive to 

control costs, and the Government assumes the financial risk that 

the service or supplies will be delivered in a cost-effective manner. 

• Fixed-price contracts. Under a fixed-price contract, the contractor is 

paid a fixed amount for performing the work or producing 

deliverables regardless of the actual cost. The contractor, therefore, 

assumes all performance and financial risk and has an incentive to 

control costs while delivering the supplies or services. 

Other Contracting Terms

Statement of work. A statement of work is a document that describes the 

contract’s purpose and the goods or services required under the 

contract. 

Full and open competition. With certain limited exceptions, agencies must 

acquire goods and services using full and open competition and 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 8 
 

 

CONTRACTING PRIMER 

competitive procedures. For stand-alone contracts, competitive 

procedures often involve soliciting proposals or sealed bids. With 

respect to the FSS, task or delivery orders are considered competitive if 

they are placed using regulatory procedures. Further, an agency must 

provide written justification and approval before awarding a contract 

directly to a sole source under a stand-alone contract or an FSS order. 

Blanket purchase agreement. BPAs are agreements, usually entered into 

under FSS contracts, that are intended for agencies that anticipate 

having recurring needs for supplies or services. Task and delivery 

orders may be placed under such BPAs. 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 9 
 

 

CDER’s contract files contained 

basic documentation required 

under the FAR. However, the 

agency used broad language in its 

statements of work that failed to describe specific requirements, 

suggesting that it had not thoroughly planned its IT service 

acquisitions. In addition, CDER acquired IT services primarily through 

flexible acquisition methods and time-and-materials contract actions 

that reduce the agency’s administrative burden but increase risk for the 

Government. The AAP report highlighted the importance of acquisition 

planning, which includes improved competition and innovative solutions 

at the best prices.29

Δ FINDINGS 

CDER’s contract actions demonstrated limited IT 

planning and increased risk for the Government

CDER used broad language to describe requirements in its statements of 

work 

Several FSS orders used identical language to describe requirements in 

the statements of work even when the orders were for different services. 

For example, six of nine orders under one BPA contained statements of 

work with identical lists of requirements that the contractor would 

provide. These lists included “IT project management support,” “IT 

planning and other support,” and “IT analysis and support.” Broad 

requirements language provided CDER with the flexibility to specify its 

requirements over time. 

Another FSS order contained broad language stating that the contractor 

“will assist with the analysis, development of plans, script writing, and 

documentation to be implemented immediately under the contract or at 

a later date by government employees.” The project officer responsible 

for this order told us that CDER wrote this statement of work to match 

the contractor’s expertise and that the actual tasks that the contractor 

performed were specifically defined only after award, when CDER 

identified its requirements.30 Another project officer highlighted the 

difficulty in defining specific requirements because routine maintenance 

tasks were difficult to capture in a statement of work. 

In addition, other statements of work contained lists of tasks that were 

never ultimately requested by CDER. For example, four of nine orders 

10 

29 AAP, “Report of the Acquisition Advisory Panel to the Office of Federal Procurement 

Policy and the United States Congress,” January 2007, p. 7. 

30 The FAR does provide authority for limiting sources under FSS orders. FAR § 8.405-6. 

For this contract action, CDER’s contract file contained a justification document explaining 

why competition was limited. 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 
 

 FINDINGS 

under one BPA included statements of work listing emergency software 

releases and various administrative reports that CDER never 

requested. One project officer told us that CDER may write a statement 

of work broadly in case the contractor needs to perform tasks in those 

areas later. 

Overall, using broad requirements in statements of work is prevalent 

throughout Government. AAP attributes the inability to clearly define 

requirements to the acquisition culture of “getting to award,” budgetary 

time pressures, and an inexperienced contracting workforce.31

CDER relied primarily on acquisition methods that emphasize speed and 

flexibility over planning 

In its contractor selection, CDER relied on acquisition methods that 

have streamlined procedures, including competition requirements. 

CDER used the FSS or governmentwide acquisition contracts for 

27 of 28 contract actions reviewed. 

Although the FAR provides for streamlined procedures, the AAP report 

raised concerns about FSS orders and governmentwide contracts that 

contain broad scopes of work and lack acquisition planning, stating that 

they may result in little meaningful competition.32 CDER’s reliance on 

FSS reflects a larger trend across Government, in which the use of FSS 

had grown to $35.1 billion by FY 2006.33 One GSA study found that 

placing orders through FSS decreased the turnaround time for placing 

an order from 268 days to 15 days.34

Of the 27 contract actions that were FSS or governmentwide acquisition 

contract actions, 24 were FSS orders. Nineteen of those twenty-four 

contract actions were delivery orders placed against three BPAs, and 

the remaining five were single orders. Three of the twenty-seven 

contract actions were governmentwide acquisition contract actions 

awarded through interagency agreements.35 

11 

31 AAP, “Report of the Acquisition Advisory Panel to the Office of Federal Procurement 

Policy and the United States Congress,” January 2007, p. 7. 

32 Ibid., pp. 91–92. 

33 GSA Data, “Contractors Report of Sales – Schedule Sales FY 2006 Final,” October 

2006 (on file with GSA). 

34 J.W. Chierichella and J.S. Aronie, “Multiple Award Schedule Contracting.” Xlibris 

Corp., 2002, p. 41, cited in AAP, “Report of the Acquisition Advisory Panel to the Office of 

Federal Procurement Policy and the United States Congress,” January 2007, p. 234. 

35 Multiple Award Schedule Contracts are awarded by GSA or the Department of 

Veterans Affairs for similar or comparable supplies or services, established with more than 

one supplier, at varying prices. The FSS program is also known as the GSA Schedules 

Program or the Multiple Award Schedule Program. See FAR 8.401–402(a). 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 
 

FINDINGS 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 12 

CDER used the FSS primarily to procure IT support services, such as 

program management or technical writing. One project officer told us 

that CDER uses contractors to fill its ongoing need for IT personnel to 

perform a variety of tasks related to operations and maintenance. The 

project officer also stated that CDER previously performed these tasks 

with its own staff. 

CDER used the FSS primarily to procure IT support services, such as 

program management or technical writing. One project officer told us 

that CDER uses contractors to fill its ongoing need for IT personnel to 

perform a variety of tasks related to operations and maintenance. The 

project officer also stated that CDER previously performed these tasks 

with its own staff. 

CDER also acquired IT services through three governmentwide 

acquisition orders placed through interagency agreements. CDER 

officials told us that they used interagency agreements primarily 

because the agency cannot perform contractor selection given its time 

and personnel constraints. In one instance, FDA received a 

congressional mandate to build a database. CDER relied on flexible 

acquisition methods to fill the need quickly. Under these 

circumstances, the agency had little time to solicit and review bids from 

contractors. 

CDER also acquired IT services through three governmentwide 

acquisition orders placed through interagency agreements. CDER 

officials told us that they used interagency agreements primarily 

because the agency cannot perform contractor selection given its time 

and personnel constraints. In one instance, FDA received a 

congressional mandate to build a database. CDER relied on flexible 

acquisition methods to fill the need quickly. Under these 

circumstances, the agency had little time to solicit and review bids from 

contractors. 

CDER relied on time-and-materials contract actions that increase risk for the 

Government 

Twenty-six of twenty-eight contract actions reviewed were 

time-and-materials contract actions. The FAR states that 

time-and-materials contracts provide no incentive for the contractors to 

control costs or increase labor efficiency and, therefore, should be used 

only when no other contracting method is suitable.36 CDER’s reliance 

on time-and-materials contracts shifts financial risk onto the 

Government and places a greater burden on the agency to control 

costs.37 

Twenty-six of twenty-eight contract actions reviewed were 

time-and-materials contract actions. The FAR states that 

time-and-materials contracts provide no incentive for the contractors to 

control costs or increase labor efficiency and, therefore, should be used 

only when no other contracting method is suitable.36 CDER’s reliance 

on time-and-materials contracts shifts financial risk onto the 

Government and places a greater burden on the agency to control 

costs.37 

Furthermore, CDER extended 24 of 26 time-and-materials contract 

actions using contract options or modifications. The FAR states that 

“contracting officers should avoid protracted use of a 

cost-reimbursement or time-and-materials contract after experience 

provides a basis for firmer pricing.”38 We saw no examples in our 

review in which CDER negotiated firmer pricing for its contract actions 

over time. 

Furthermore, CDER extended 24 of 26 time-and-materials contract 

actions using contract options or modifications. The FAR states that 

“contracting officers should avoid protracted use of a 

cost-reimbursement or time-and-materials contract after experience 

provides a basis for firmer pricing.”38 We saw no examples in our 

review in which CDER negotiated firmer pricing for its contract actions 

over time. 

36 FAR § 16.601(c). 

37 Ibid., § 16.601(c)(1). If the Government is not satisfied with the work performed by the 

contractor, the Government may ask the contractor to remedy the deficiencies but must pay 

the hourly rate (minus the portion that is profit) until the work is completed. 

FAR § 52.212-4(a)(4). 

38 Ibid., § 16.103(c). 
 

 

FINDINGS 

CDER may not achieve the benefits of performance-based acquisitions 

13 

s. 

CDER characterized 20 of 28 contract actions as performance-based 

acquisitions, but most of these contract actions did not include 

measurable performance standards and only one included a 

performance incentive plan. The FAR requires that performance-based 

contracts contain a statement of work focused on the agency’s desired 

outcomes, measurable performance standards, and a performance 

incentive plan.39 Performance incentives provide additional funds to 

the contractor for achieving measurable goal

In fact, 19 of the 20 performance-based contract actions identified were 

time-and-materials contract actions. Because they provide no incentive 

for the contractor to control costs or increase labor efficiency, 

time-and-materials contract actions may undermine the benefits of 

performance-based acquisition. 

Even when contract actions included measurable performance 

standards, CDER used them inconsistently. In several contract actions, 

CDER included measurable performance standards, such as the amount 

of time needed to resolve help desk issues or hours of operation. 

However, the same actions included standards that were simply lists of 

deliverables with no measure of quality. One project officer stated that 

measurable performance standards do not always readily apply to IT 

services, such as project management and maintenance and operations. 

CDER’s lack of clear performance measures may be related to the lack 

of clear work requirements that we referred to previously. 

Furthermore, in the one contract action for which CDER used a 

performance incentive plan, it relied on largely subjective performance 

elements, such as the extent to which “contractor personnel are 

prepared for meetings and briefings” and whether work is “performed 

efficiently with the correct skill mix.” 

Because CDER did not clearly 

define its requirements or 

performance measures, it also 

did not consistently establish 

QA plans. QA plans state how and when an agency will evaluate the 

contractor’s performance against established performance measures. 

When the agency monitors the contractor according to the QA plan, it 

CDER used quality assurance and 

monitoring plans inconsistently 

39 Ibid., § 37.601(b). 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 
 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 14 

FINDINGS 

protects taxpayer funds by holding the contractor accountable for its 

performance. 

Twenty-one of twenty-eight contract actions reviewed did not have 

documented QA plans. Of the seven contract actions that included QA 

plans, three contained identical plans with generic language calling for 

100-percent inspection of deliverables using the same checklist of 

qualitative measures. For two of these three contract actions, the 

project officers told us that they did not use the plans within their 

respective statements of work. 

Without documented QA plans to guide contractor monitoring, CDER’s 

monitoring appears to focus more on day-to-day tasks than on 

measuring the quality of the contractors’ performance. For example, 

one contract action without a QA plan contained monitoring 

documentation consisting of status reports with a breakdown of the 

number of hours that the contractor worked on different IT systems. 

The project officer told us that he reviewed the status reports for billing 

purposes. Several project officers stated that because contractors often 

work in the same office as CDER staff, monitoring often consists of 

informal discussions, e-mails, and ad hoc meetings. 

The FAR generally provides agencies with discretion when monitoring 

contracts. However, the FAR also considers time-and-materials 

contracts to be high-risk contracts that require monitoring 

commensurate with the risk. As noted earlier, the majority of the 

contract actions reviewed were time-and-materials. 
 

 

Δ RECOMMENDATIONS 

CDER is responsible for ensuring that drugs marketed within the 

United States are safe and effective. In keeping with this mission, it is 

critical that CDER procure IT systems and services that meet its needs 

in a cost-effective manner while complying with relevant acquisition 

regulations. We acknowledge that Federal IT contracting presents 

unique challenges for acquisition personnel and project managers. 

Although the IT contract actions reviewed were generally compliant 

with the FAR, several areas of concern exist with CDER’s IT planning 

process and its contract monitoring. We found that CDER used broad 

language to describe requirements in its statements of work, relied 

primarily on acquisition methods that emphasize speed and flexibility 

over planning, relied on time-and-materials contract actions that 

increase financial risk to the Government, and may not achieve the 

benefits of performance-based acquisitions. We also found that CDER 

used QA and monitoring plans inconsistently. The AAP report of 2007 

found the same problems throughout the Federal Government. 

FDA’s Office of Information Management absorbed CDER OIT at the 

end of FY 2008. Although CDER OIT no longer exists as a separate 

entity, we identified several steps that FDA should take to minimize its 

contract risk. FDA should: 

Define IT Requirements More Clearly 

FDA should revise its planning processes to define IT requirements in 

greater detail. Defining requirements more clearly may lead to 

additional contracting options, such as the use of fixed-price contracts 

with performance incentives. FDA could create greater efficiencies in 

contractor selection and project management as well. 

Convert Ongoing Time-and-Materials Contract Actions to Fixed-Price 

Contract Actions When Appropriate 

Although the flexibility of time-and-materials contract actions gives 

FDA access to a range of contractor expertise when designing a new IT 

system, this contract type shifts financial risk onto the Government and 

may not represent the best value for ongoing operations and 

maintenance functions. Converting ongoing time-and-materials 

contract actions to fixed-price contract actions would reduce the 

financial risk borne by the Government and may allow FDA to obtain 

the same services at a reduced cost. In addition, converting 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 15 
 

R E C O M M E N D A T I O N S 

time-and-materials contract actions to fixed-price contract actions would 

also reduce the amount of oversight needed to ensure labor efficiency. 

Use Performance Incentive Plans When Appropriate 

FDA could achieve many benefits from the proper use of 

performance-based acquisitions, such as competitive pricing, innovative 

solutions, quality services, and results that support agency missions. 

Use of performance incentives could allow FDA to reduce contract costs 

by tying the contractor’s profit or award fees to quantifiable 

performance standards. 

FDA could achieve many benefits from the proper use of 

performance-based acquisitions, such as competitive pricing, innovative 

solutions, quality services, and results that support agency missions. 

Use of performance incentives could allow FDA to reduce contract costs 

by tying the contractor’s profit or award fees to quantifiable 

performance standards. 

Use Documented QA Plans 

QA plans state how and when an agency will evaluate the contractor’s 

performance against established performance measures. Implementing 

formal QA plans in its contract actions would allow FDA to identify 

services that do not meet the defined requirements and create a 

mechanism for contractor accountability. 

QA plans state how and when an agency will evaluate the contractor’s 

performance against established performance measures. Implementing 

formal QA plans in its contract actions would allow FDA to identify 

services that do not meet the defined requirements and create a 

mechanism for contractor accountability. 

AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL 

RESPONSE

FDA agreed with three of our four recommendations and identified 

steps it is taking to implement them. It also noted that its 

organizational restructuring in FY 2008 centralized IT resources and 

created new processes for acquisition planning. 

FDA neither agreed nor disagreed with our first recommendation to 

define its IT requirements more clearly. However, it did identify actions 

it is taking that support that recommendation. Specifically, FDA 

reported that it is implementing new processes during the early stages 

of acquisition planning to better coordinate its IT systems and create 

efficiencies across FDA. These processes are intended to assist in 

defining requirements. 

In addition, FDA agreed with our recommendations to convert 

time-and-materials contracts to fixed-price contracts when appropriate 

but noted that fixed-price contracts are most effective for acquisitions in 

which requirements are clear, such as those for hardware and 

commercial off-the-shelf software. Finally, FDA agreed with our 

recommendations to use performance incentive plans and quality 

assurance plans, stating that it will use these methods in future 

contracts when applicable. 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 16 
 

 

RECOMMENDATIONS 

We ask that in its final management decision, FDA more clearly 

indicate whether it concurs with our first recommendation and what 

steps it will take to implement it. 

For the full text of FDA’s comments, see Appendix C. 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 17 
 

 Δ APPENDIX~A 

Glossary of Abbreviations, Acronyms, and Contracting Terms 

Acquisition Advisory Panel (AAP). The Services Acquisition Reform Act 

of 2003 created AAP to review Federal acquisition laws and regulations 

and make recommendations to improve contracting practices, 

particularly regarding commercial and performance-based acquisitions. 

Blanket Purchase Agreement (BPA). Rather than issue new contracts, 

agencies may place delivery orders under a BPA to fill recurring needs 

for supplies or services. 

Federal Acquisition Regulation (FAR). The FAR is the primary set of 

regulations governing Federal contracting. 

Federal Procurement Data System (FPDS). The FPDS is an online 

database that captures basic information on Government contracts, 

such as the purchasing agency, contractor name, and contracted dollar 

amount, and indicates whether the contract was awarded competitively. 

Federal Supply Schedule (FSS). The FSS is one type of Multiple Award 

Schedule operated by the General Services Administration. It is a list of 

prenegotiated Government contracts for commonly used commercial 

items and services that Federal agencies and other entities may use. 

Government-Wide Acquisition Contract (GWAC). The Clinger-Cohen Act 

established GWACs for the streamlined acquisition of information 

technology (IT) services and products. 

Performance-Based Acquisition (PBA). The PBA is the Government’s 

preferred method of service contracting according to the FAR. PBA 

states the Government’s desired outcomes and allows the contractor to 

decide how the work will be done to achieve those outcomes. 

Options. An option is a unilateral right in a contract by which the 

Government may choose to purchase additional supplies or services or 

extend the term of the contract. Contracting officers may include 

options in contracts when they are in the Government’s interest. 

Risk. Risk refers to the possibility that a contract will not be fulfilled at 

the agreed-upon price. For example, if the Government agrees to pay a 

contractor a fixed price to build an IT system, the contractor earns 

additional profit only if it can build the IT system at a cost less than the 

fixed price. Thus, the contractor assumes the financial risk. 

Small Business Contracting Goals. The FAR requires the Government 

to provide contracting opportunities to small businesses, those owned by 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 18 
 

 

APPENDIX~A 

veterans and women, those in economically underutilized areas, and 

those owned by other groups that may be at a disadvantage when 

competing for contracts. The annual small business goal for all 

governmentwide prime contract dollars is 23 percent. Agencies must 

report their small business contract awards through the FPDS. 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 19 
 

 

Δ APPENDIX~B 

Legal Authorities Governing Federal Acquisitions 

Assisted Acquisition. 48 CFR § 4.601 (definition of assisted acquisition)

Blanket Purchase Agreements (BPA). 48 CFR § 8.405-3(a) (BPAs under 

Multiple Award Schedule (MAS)/Federal Supply Schedule (FSS) 

contracts); 48 CFR § 13.303 (stand-alone BPA)

Competition Requirements. 48 CFR ch. 1, Part 6; 48 CFR ch. 1, subpart 

8.4 (FSS competition requirements); 48 CFR § 16.505 (multiagency 

contracts competition requirements)

Evaluation Factors. 48 CFR § 15.303(b)(94) (negotiated contracts); 

48 CFR § 14.201-5(c) (sealed bid contracts); 48 CFR § 13.106-1 

(simplified acquisitions)

Federal Acquisition Regulation Authority and Applicability. 41 U.S.C. 

§ 405(a); 48 CFR § 1.104; 48 CFR § 2.101 (definition of acquisition)

Federal Procurement Data System (FPDS). 48 CFR ch. 1, subpart 4.6 

FSS Contracts (also known as MAS contracts). 41 U.S.C. § 259(b)(3); 

48 CFR § 8.404(a); 48 CFR § 6.102(d)(3)

Multiagency Contracts (MAC) and Governmentwide Acquisition Contracts 

(GWAC). 41 U.S.C. §§ 253h and 253k (MAC); 41 U.S.C. 

§ 11314(a)(2) (GWAC); 48 CFR § 2.101 (definition of MAC and GWAC)

Option. 48 CFR § 2.101 (definition of option); 48 CFR § 17.202 (option 

inclusion and exercise)

Performance-Based Acquisitions (PBA). Floyd Spence National Defense 

Authorization Act FY 01, P.L. No. 106-398, § 821 (Oct. 30, 2000); 

48 CFR § 2.101 (definition of PBA); 48 CFR § 37.102(a); 48 CFR § 37.601

Quality Assurance Requirements. 48 CFR, subpart 46.4; 48 CFR 

§ 16.601(b)(1) (time-and-materials contracts-related Government 

surveillance requirement)

Small Business Governmentwide Goal. 15 U.S.C. § 644(g)(1) (annual 

goal for prime contracts across Government) 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 20 
 

 

Δ APPENDIX C 

Agency Comments 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 21 
 

 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 22 

APPENDIX ~ C 
 

 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 23 

APPENDIX ~ C 
 

 

 O E I - 0 1 - 0 7 - 0 0 4 5 0 MANAGEMENT OF I NFORMATION T ECHNOLOGY C ONTRACTS AT FDA’ S CDER 24 

Δ ACKNOWLEDGMENTS 

This report was prepared under the direction of Joyce M. Greenleaf, 

Regional Inspector General for Evaluation and Inspections in the 

Boston regional office, and Russell W. Hereford, Deputy Regional 

Inspector General. 

Christopher Galvin served as the team leader for this study. Other 

principal Office of Evaluation and Inspections staff from the Boston 

regional office who contributed to the report include Melissa Hafner and 

Rose Lichtenstein; central office staff who contributed include Mark 

Richardson and Matthew McMullen.