CINCINNATI – Laboratory Corporation of America’s landing of a contract for DNA testing with the state of Ohio has triggered a formal protest by the loser in the bidding process.

Ohio-based DNA Diagnostics Center wants Gov. Ted Strickland to review an agency’s decision to award the work to Burlington, N.C.-based (NYSE: LH). LabCorp operates several facilities in Ohio.
The company didn’t respond for requests for comment by the Associated Press.

DNA Diagnostics Center complained in a letter to Strickland dated Wednesday that awarding the three-year contract to an out-of-state competitor will cost the state an additional $1 million and goes against the governor’s promise to buy products and services from Ohio companies whenever possible.

DNA Diagnostics has laid off 15 employees because it lost the state’s business, which would have been worth about $3.5 million a year, spokesman Jim Hanigan said Thursday.

In a letter to Strickland, DNA Diagnostics president Ellen Moscovitz cited the governor’s budget message to the General Assembly about supporting Ohio companies and said she was "deeply disappointed" that the Ohio Department of Administrative Services had awarded the entire DNA testing contract to LabCorp.

DNA Diagnostics has conducted genetic tests for more than 1 million clients around the world since 1995. Until the start of this fiscal year, it had conducted paternity tests for the state, while LabCorp performed forensic tests.

The new contract combined paternity testing with all DNA testing for the three years from July 1 of this year to June 30, 2012. Over the life of the contract, the Ohio company’s bid of $3.5 million a year would have been about $1 million less than the one awarded to LabCorp, Moscovitz said.

The Department of Administrative Services refused to consider the bid because of a two-step process in which a bidder’s qualifications are rated before bids are opened, DNA said. DNA contends that its qualifications were grossly underscored.

"It doesn’t seem to really add up," Hanigan said. "We have every certification you could ever want. We’ve been performing this type of service for the state for the past four years and they were happy with us. How is it that we didn’t even qualify now?"

Amanda Wurst, the governor’s spokeswoman, said Strickland received the letter and asked the Department of Administrative Services to review the bidding.

The state’s analysis shows Ohio will save about $1.2 million using LabCorp, Sylvester said. He also said DNA did not meet technical scoring criteria and did not provide enough information for a complete analysis of what DNA said it would do