[Protest of HHS Contract Award]

A firm protested a National Institute on Drug Abuse contract award for financial advisory services. The request for proposals contemplated the award of a cost-plus-fixed-fee contract. Award was to be based primarily on technical merit. After first including the protester in the competitive range, the evaluation committee conducted a second evaluation and excluded the protester and two lower rated offerers from the competitive range because they did not stand a reasonable chance of being selected for award. Cost negotiations were initiated with the only remaining offerer and the contract was awarded to that firm. The protester argued that redefining the competitive range after negotiations to eliminate all but one offerer from the competition was improper because, under Health and Human Services Procurement Regulations, all offerers initially included in the competitive range must be permitted to submit a best and final offer. GAO stated that there is nothing improper in an agency's making more than one competitive range determination. Since the protester was excluded from the competitive range after negotiations, the agency was not required to solicit its best and final offer. GAO will not disturb an agency's determination of whether a proposal is within the competitive range absent a clear showing that it was unreasonable or contrary to procurement regulations. In this case, it was clear that the protester's proposal could have been included in the final competitive range; however, GAO could not conclude that the agency's exclusion of the protester from the competitive range was unreasonable or improper. The evaluators had found the protester to be weak in experience, an area that could not be expected to improve in a best and final offer. Therefore, GAO found that the agency reasonably determined that the protester could not reduce its cost sufficiently to offset the awardee's technical advantage. In addition, estimated costs are not controlling in selecting a contractor for a cost-reimbursement type contract. Accordingly, the protest was denied.