iCAD Inc. (NSDQ:ICAD) won a contract with the U.S. Defense and Veterans Affairs departments to sell its cancer detection devices to the 400 treatment facilities under the agencies’ auspices.

The Nashua, N.H.-based company, which designs image analysis equipment for the early identification of cancer, entered the agreement with the Defense Supply Center to provide federal healthcare facilities, including Veteran’s Administration and Dept. of Defense hospitals with its computer-aided mammography technology for.

The new contract will be welcome for the company whose net losses widened during the first three months of 2010, as it saw revenues slip $6.5 million or 9.7 percent from year-ago levels.

The technology uses algorithms to evaluate radiological image data, assisting doctors in detecting cancer by providing visual indications of suspicious areas in body tissue. The company said the equipment will enable clinicians to find cancer at earlier stages than the DoD’s and VA’s current equipment.

In March, iCad won patents for lesion metrics and computed tomography image analysis software used in its computer-aided detection system.