On Dec. 20 of last year, the Department of Veteran Affairs terminated an agreement with the startup Flow Health. The startup claims the two were creating artificial intelligence with the power to predict disease.

So why was the contract canceled?

We took this action after it was determined that the agreement, which involves genomic data from the Million Veteran Program (MVP), may violate regulations, VA policy, and VA’s longstanding commitment to our Veterans to protect their data,” said VA Undersecretary for Health David Shulkin in a statement shared with VentureBeat. “It is important to note that no Veterans’ data were shared or compromised.”

In an interview with VentureBeat last month, prior to the cancelation, CEO Alex Meshkin said that last spring the startup began a five-year contract with the VA to examine Million Veteran Program genetic information and all historic and ongoing VA medical records.

The information was to be used to train artificial intelligence with the ability to fight illness and predict disease for the more than eight million people cared for by the Department of Veteran Affairs.

“The essence of it is that the VA supplies all its historical data, historical and ongoing,” Meshkin said. “The graph is built around the co-frequency or co-occurrence of relationships and all the unstructured and structured data — clinical notes, medical images, even molecular diagnostics like genetics and of course traditional lab tests and so forth.”

Advice and predictions from Flow Health would then be presented to health care professionals through Vista, the Department of Defense’s open-source system for electronic medical records, Meshkin said.

“Entering into such an agreement with any company requires additional research, consultation with medical and privacy experts and appropriate, senior-level sign-offs to make sure the use of the data comports with the letter and spirit of the regulations while also protecting Veterans’ sensitive data. That was not fully done in this instance,” Shulkin said.

In addition to its partnership with the Department of Veteran Affairs, Flow Health claims to be working with academic medical centers and one of the largest health care providers in the country to provide similar predictive insights to health care professionals.

Meshkin told VentureBeat that once the agreement was over, the knowledge base the company planned to build would then belong to Flow Health.

“Everything we develop with the VA, we own the intellectual property and can make available to any other hospital within the U.S. or abroad, and that’s kind of the goal here of the collaboration, to create really powerful tools and machine intelligence that can impact health care for everyone,” Meshkin said.

VentureBeat has reached out to Flow Health for additional comment on the canceled agreement but did not receive a response by the time this story was published. This story will be updated should VentureBeat receive comment from Flow Health.

The sharing of public health data with private entities focused on machine learning has sparked controversy in the past.

Last year, Google was criticized when details of a collaboration with the National Health Service in the United Kingdom were discovered. Initially, according to reporting by New Scientist, the deal was thought to only include data sharing for an app that monitors patients with kidney disease, but was later found to be more pervasive. Last July, DeepMind announced that it would receive one million anonymized retinal scans from a hospital run by the NHS Foundation Trust.

Google says DeepMind’s computer vision could greatly reduce the risk of blindness for people with diabetes, and the program has gained the backing of sight-related charities and organizations. But critics are upset that their data was shared with a private company which stands to benefit financially as a result, and that their personal data, though anonymized, will be shared without their consent.

Update 8:20 a.m. Pacific Time: The original version of this story described a business and research agreement between Flow Health and the Department of Veteran Affairs, but failed to state that the VA canceled its contract with Flow Health. This story has been updated to include a statement from VA Undersecretary for Health David Shulkin. Mention of a voucher program supported by President Trump and claims by Meshkin of potential impact on Flow Health research have also been removed from this story.