Essential insight into England’s biggest health economy, by Ben Clover.

As we approach mid-January, the deadline for the award of a huge contract looms ever larger.

The procurement team from Guy’s and St Thomas’ Foundation Trust has led the process of getting a pathology provider for the next 15 years on behalf of all the parties in south London.

A preferred provider is due to be named next month.

There are already several noteworthy features to this exercise, as well as its size — a whopping £2.25bn.

First, Lewisham and Greenwich Trust, a £575m-turnover multisite provider serving a population of around 750,000, is not a party to the deal. The trust is jumping in with Barts Health Trust for its pathology instead. The south east London procurement covers all the other London providers plus the tests ordered by GPs across six boroughs.

Second, there is a huge conflict of interest elephant-in-the-room around the process. Two of the organisations procuring the service (GSTT and King’s) co-own one of the bidders, Viapath.

Viapath is the incumbent and is owned by the two FTs and private firm Serco. There might be a way to run the process without this being an issue but no one has ever explained it. As such, it is hard to say how likely a legal challenge to any decision might be.

Board papers from South East London Sustainability and Transformation Partnership show some legal support is already being commissioned. Specifically, “QC advice on any legal risks to a potential down-selection decision from [an] evaluation”.

Certainly, the prize is significant.

For one of the other bidders, HSL, the north London partnership between an Australian company and University College London Hospitals FT and the Royal Free, winning the contract would see it become the dominant pathology provider in the capital, significantly larger than rivals.

For IPP — the third bidder for the work — the south east London contract would be its biggest single contract and an important boost to its existing business.

If Viapath were to lose the contract, then it would pretty much cease to exist, as its labs at GSTT and King’s form the vast majority of its work.

A different problem

London Eye is indebted to readers from the primary care sector who point out another potential problem for the procurement.

Lewisham and Greenwich Trust’s exit from overall procurement means that whichever of the three bidders that wins the contract, the trust stands to lose the GP direct access tests which it currently carries out.

For GPs in this area, that could see their work bypass LGT and go to wherever the SEL pathology labs end up being centralised (which is not a given but seems an obvious way to save money).

The effect of the loss of Lewisham and Greenwich’s primary care pathology work has not been discussed in any public forum so far but could cause problems for the trust.