Gov't Contracts Of The Month: Virus, Space And Google Deals

By Alyssa Aquino
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Law360 (May 29, 2020, 7:13 PM EDT) -- The federal government looked to the future in May, injecting $1.2 billion into AstraZeneca's candidate COVID-19 vaccine and infusing billions into the U.S.'s space-bound ambitions. Other megadeals include remediation of a nuclear site and Google's partnership with the Pentagon.

Here are Law360's top picks for government contracts awarded in May:

AstraZeneca Emerges as U.S.'s Top Bet for COVID-19 Vaccine

As pharmaceutical companies scramble to produce a vaccine for the disease caused by the novel coronavirus, the U.S. has backed AstraZeneca PLC's proposed drug to the tune of $1.2 billion, the largest sum of federal dollars injected into any candidate drug.

The U.S. Department of Health and Human Services has thus far awarded five government contracts to boost vaccine development efforts. But AstraZeneca's May 21 deal far outstrips the federal government's next largest commitments: $430 million to ModernTX Inc. and $456 million to Janssen Research & Development LLC.

According to HHS, the partnership will accelerate the development and manufacture of the company's investigation vaccine, AZD1222, which has only been undergoing Phase 1/Phase 2 domestic clinical studies since the end of April, but will enter Phase 3 in the coming weeks with roughly 30,000 American volunteers.

Under the deal, AstraZeneca will produce at least 200 million doses of its candidate vaccine, with the intent to roll out first doses as early as October, HHS said.

The arrangement is a "major milestone" in the Trump administration's push to make 300 million doses of a COVID-19 vaccine available by January, HHS Secretary Alex Azar said.

The U.S.'s expectations for a viable vaccine are high, with the Pentagon giving ApiJect Systems America a hefty $138 million to ramp up production of medical-grade injection devices.

The U.S. Commits to Next Frontier: Space

As the coronavirus rages on, the U.S. is doubling down on its commitment to the next frontier, with NASA handing out contracts to get people back in space and the Pentagon issuing awards under a wartime law currently associated with ventilator production and the meat supply line.

NASA is determined to reestablish American lunar presence. On the last day of April, the agency announced that it had tapped a trio of teams to develop the Artemis Human Landing System, an award topping out at nearly a billion dollars.

The lunar lander contracts were handed out to Dynetics Inc., the Elon Musk-helmed SpaceX and Blue Origin, a three-way partnership among Lockheed Martin Corp., Northrop Grumman Corp. and Draper Inc., according to NASA.

"With these contract awards, America is moving forward with the final step needed to land astronauts on the moon by 2024," said NASA administrator Jim Bridenstine.

The agency quickly followed up on those awards by handing Aerojet Rocketdyne Holdings Inc. an extra $1.79 billion to produce 18 additional RS-25 engines under an existing procurement. Aerojet announced the additional cash on May 1, saying the engines will be used to support future deep space exploration missions.

The Defense Department announced Friday that it inked agreements with 5N Plus Semiconductor and SolAero Technologies to protect the space defense industrial base.

The contracts, which add up to $18.45 million, were awarded under Title III of the Defense Production Act, which enables the executive branch to issue economic incentives to support the production of goods for the national defense.

The funds will allow 5N — the country's only domestic supplier of semiconductor technologies critical for space programs — to continue semiconductor manufacturing. They will also allow SolAero to retain its workforce to protect the company's production of satellite solar cells and panels, according to the Pentagon.

Feds Sink $13B Into Nuclear Waste Cleanup

The Energy Department has chosen a joint venture to carry out the $13 billion work to close a tank in the decommissioned Hanford nuclear site.

Hanford Works Restoration LLC, a joint venture between a BWX Technologies Inc. subsidiary and Fluor Corporation, announced their multibillion-dollar coup on May 18. Under the contract's 10-year period, HWR will remediate and close the Hanford site's single-shell waste tank and will operate and maintain equipment to pretreat and funnel nuclear waste into a processing facility, according to the statement revealing the award.

The May contract is the latest in the Energy Department's efforts to clean up the Hanford site, which still contains millions of tons of solid waste and hundreds of billions of gallons of liquid waste, according to the government's Hanford website. In December, the department handed out Hanford awards totaling $14 billion to two separate vehicles comprising major federal contractors, which included AECOM Management Services Inc., Leidos Integrated Technology LLC and Centerra Group LLC, according to the DOE.

The DOE's expensive campaign to remediate the Hanford site has attracted federal scrutiny, with the U.S. Government Accountability Office reporting mid-May that the department's cleanup strategy is unclear.

Google Proves It's Still Open to the Pentagon

Google LLC inked a "seven figure" IT agreement with the Pentagon in May, a sign the tech giant is still up for defense team-ups, despite its withdrawal from two high-profile programs in the past few years.

Google announced on May 20 that the Defense Department's technology outreach unit will be using Google's cloud management system, Anthos, to respond to cybersecurity threats across various clouds.

The deal is for one year, but can be extended for up to five years, and is worth "seven figures," a Google spokesman told Law360. If successful, Google expects the DOD will use the project as a model for imposing a broader security program across the department, according to the company's statement.

The agreement embeds Google in the Pentagon's campaign to move its information technology platforms to the cloud.

The company previously pulled itself out of contention for the Pentagon's Joint Enterprise Defense Infrastructure cloud project, the up-to $10 billion cloud program that has received wide attention as the DOD pushes to transfer its IT infrastructure online. The deal was awarded to Microsoft in October 2019, but has been stalled by a series of protests from Amazon.

And after employee backlash, Google withdrew from Project Maven in June 2018, an artificial intelligence program designed to analyze aerial imagery to, eventually, improve drone strikes. Thousands of Google employees protested the company's involvement, signing an open letter begging the company to turn away from "warfare technology."

Lockheed Flies High With $8B Weapons Sales

Lockheed Martin Corp. was busy in the past month, winning six defense deals with multibillion-dollar price tags and securing the State Department's approval of a foreign military sale.

The defense contractor announced a tranche of Pentagon deals on April 30, including a $6 billion army contract to produce PAC-3 missile interceptors for the next three fiscal years.

"This contract demonstrates our customer's continued confidence in our ability to deliver unmatched Hit-to-Kill technology that defeats the ever-expanding global threats of today and tomorrow," said Scott Arnold, a vice president at the company's missile and fire control unit.

Ten countries have already agreed to purchase the missile interceptor system, according to Lockheed.

The State Department handed Lockheed its own win by approving the Kuwait government's three foreign military agreements to purchase PAC-3 missile enhancement segments, program support and repair services.

Lockheed is the principle contractor on the $800 million PAC-3 missile component sale. The company is also one of several principles for Kuwait's related deals for $425 million of program support and $200 million of repair services.

Construction Co. Favored by Trump Gets Largest Payout Yet for Border Wall

Fisher Sand and Gravel Co. drew attention when news broke that it nabbed $1.3 billion to build a 42-mile section of the border wall ⁠— the largest border wall contract awarded yet.

Sen. Kevin Cramer, R-N.D., whose district includes the company, confirmed the deal to the Associated Press on May 20, saying the Fisher Sand segment will cut through "really tough terrain in the mountains" in Arizona. 

Fisher Sand previously fell under public scrutiny when it obtained a $400 million contract for border wall construction, with Rep. Bennie Thompson, D-Miss., calling on a government watchdog to review the award.

In a letter to the U.S. Army Corps of Engineers, Thompson questioned whether the Trump administration had "inappropriate influence" over the contracting decision, citing reporting by the Washington Post that President Donald Trump has "personally repeatedly urged" the Corps to award the contract to Fisher Sand, even though the company's proposals reportedly fell short of U.S. Customs and Border Protection's requirements.

---Additional reporting by Daniel Wilson and Suzanne Monyak. Editing by Haylee Pearl.

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