HP Retains $543 Million Wireless Contract After IBM Protest

Hewlett-Packard Co. (HPQ) retained a $543 million federal contract to provide wireless tracking of medical devices following International Business Machines Corp. (IBM)’s protest.

IBM had challenged a June decision to give the five-year Department of Veterans Affairs contract to HP. The U.S. Government Accountability Office, which arbitrates contract disputes, agreed with IBM’s argument that the VA didn’t properly evaluate proposals from vendors seeking the contract. In October, it directed the agency to reconsider the award.

After re-evaluating the bids, the department decided to stick with HP, according to Jo Schuda, a VA spokeswoman.

The VA chose HP “again as the best value for the government,” Schuda said in an e-mail today.

HP, based in Palo Alto, California, beat five other companies to win the work to provide veterans hospitals with wireless tracking systems, according to VA documents.

The technology would help minimize lost equipment, track whether medical devices are properly sterilized and identify patients who may have received recalled products, according to documents posted online.

The VA ordered HP to stop work on the project in June, after Armonk, New York-based IBM protested the award.

-- Editors: Stephanie Stoughton, Steve Geimann

To contact the reporter on this story: Kathleen Miller in Washington at Kmiller01@bloomberg.net

To contact the editor responsible for this story: Stephanie Stoughton at sstoughton@bloomberg.net