Need To Improve Administration of a Carcinogen Testing and Carcinogenesis Research Contract

HRD-78-44: Published: Feb 10, 1978. Publicly Released: Feb 10, 1978.

Additional Materials:


Office of Public Affairs
(202) 512-4800

In May 1973 the National Cancer Institute (NCI) renewed, for 18 months, a sole-source contract with the Eppley Institute for cancer research. Since the $3.4 million renewal, the contract has been modified several times so that, as of November 1977, 36 months and $9.4 million have been added to the contract period and cost. NCI awarded a 1-year, $3.6 million extension to the contract in November 1977.

In renewing the contract, NCI used an ad hoc group to make technical reviews of the proposal rather than the standing committees chartered for this purpose. Recommendations were apparently disregarded in negotiating the scope and amount of the contract, and justification for noncompetitive procurement was not based totally on facts. Problems identified in contract administration and performance were: contract monitoring was ineffective; the contractor did not fulfill reporting obligations; Eppley officials carried out and financed 11 projects with contract funds without obtaining initial formal approval; Eppley made charges to contract funds for personnel, laboratory animals, supplies and equipment which were not used for contract work or were not adequately controlled; and Eppley received approval to refurbish its breeding facility which was breeding more animals than were needed for research. Eppley has taken some action to reimburse the contract for noncontract costs. A review of the contract by the Department of Health, Education, and Welfare (HEW) Audit Agency is under way.

Recommendation for Executive Action

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Secretary of HEW should: require that the audit of the Eppley contract cover matters relating to improper use of Federal funds and equipment and obtain appropriate corrective actions; require that NCI officials obtain and analyze data on the need for research animals at Eppley before approval is given to refurbish the animal farm; provide for necessary inventory controls and use of equipment and personnel under contract funds; require that recommendations of scientific reviewers, a management group, and auditors be used in negotiating a budget for future work; require that noncompetitive procurement be based totally on facts; require that the contractor's budget proposal contain data on each proposed project; and consider adding provisions to any future contract to clearly state conditions for project approval, personnel use, contract modifications, and inventory control. For future contract work with Eppley, the Secretary of HEW should improve contract monitoring and administration.

    Agency Affected:


Explore the full database of GAO's Open Recommendations »

Mar 20, 2018

Mar 13, 2018

Mar 12, 2018

Feb 15, 2018

Feb 8, 2018

Feb 2, 2018

Jan 8, 2018

Dec 21, 2017

Dec 13, 2017

Nov 6, 2017

Looking for more? Browse all our products here