Company won earmarked funds for work on military health records

Adara Networks, the company that is the subject of a Defense Department employee's allegations that it received important software code in advance of winning a sole-source contract to provide hardware and software for a new military electronic health record system, has only between 20 and 50 employees and revenues of $8 million a year, according to online records. But the company has powerful friends in Washington.

Sen. Thad Cochran, R-Miss., inserted earmarks in the fiscal 2008 and 2009 Defense appropriations measures funding work by Adara on Defense health record systems. He also has a pending earmark for Adara in the 2010 Defense appropriations bill.

According to the Center for Responsive Politics, Adara has paid $240,000 in lobbying fees to Gage LLC, a consulting and government affairs firm whose partners include former Sen. Conrad Burns, R-Mont.. The firm is headed by Burns' former chief of staff, Leo A. Giacometto.

The bulk of the fees, $160,000, went to Gage last year, making Adara one of the company's biggest sources of revenue in 2008. The Adara lobbying tab from Gage last year matched the fee paid to the lobbying firm by VeriSign, an Internet security company that had revenues of $255 million in the first quarter of this year.

According to a database of federal contract awards, Adara won Defense contracts valued at $7.2 million in 2007 and $13.7 million in 2008.

Cochran's earmarks steered $4 million to Adara last year for work on what was described as a "next-generation networking electronic medical records project" and $1.1 million in 2009 for the Strategic/Tactical Resource Interoperability Kinetic Environment (STRIKE) project. Cochran has sought $10 million in Adara funding for the STRIKE project in the 2010 Defense appropriations bill, which is pending in the Senate.

The STRIKE project, according to Cochran's office, is designed to help the Defense Department solve problems of interoperability, scalability, performance and security in its medical information technology systems.

Internal Military Health System briefings show that Adara's NPX routers, which the company says are capable of moving data around faster than rival products, sit at the heart of the new Military Health System electronic record architecture. The routers serve as a bridge between Defense's AHLTA electronic health record system, the Clinical Data Repository that stores more than 9 million military health records, and VA's electronic health record system.

An internal e-mail NextGov obtained shows that the Military Health System tapped Adara to provide software as well as hardware for a new enterprise architecture, including a means of exchanging data and a graphical user interface to view medical records.

In that e-mail, Maj. Frank Tucker, chief of product development for the Defense Health Information Management System at MHS, charged he was directed to provide Adara with software source code and documentation, which he viewed as unethical, because this would give the company a leg-up in any competition.

Tucker alleged Adara was awarded a sole-source contract by the Military Health System, but did not specify the contract's value.

Adara has not returned calls seeking comment from NextGov for the past three days. Cochran's office did not respond to a request for comment placed Wednesday.