Defence giant retires from NHS bid

US defence giant Lockheed Martin has withdrawn from the race for NHS National Programme contracts.

The £2.3bn IT initiative is split into a number of different areas. The supplier was on the shortlist for the national 'data spine' contract and the Local Service Provider (LSP) contract for the London area, but has pulled out of both bids.

Sources close to the bidding suggest the company's withdrawal may be down to the stringent terms and conditions, including harsh fines to be imposed on suppliers whose systems fall short of the government's performance targets.

Lockheed Martin will not comment beyond confirmation of its withdrawal.

A spokesman for the National Programme said: ' We are pleased Lockheed Martin has given us notice of their withdrawal now, rather than at a later stage of the competition, and value the efforts they have made up to this point.'

Other suppliers bidding for the deals deny rumours that Lockheed Martin's decision may be the start of a trend.

'I can categorically deny we are withdrawing from the NHS IT project,' said a spokesman for Accenture, which is on the LSP shortlist.

An IBM spokeswoman said: 'IBM remains fully committed to all aspects of the National Programme.'

The shortlist for the data spine is now down to two - BT and IBM. The LSP shortlist also includes Fujitsu and EDS.

National Application Service Providers will supply ebooking and eprescription software and the central 'data spine' underpinning the Integrated Care Records System. LSPs will be chosen to co-ordinate implementation and management across five regional clusters.