Am I being discriminated against?

A few weeks ago I posted for an internal position within my company. It would be a lateral move (I have plenty of experience in that job function) and I simply wanted a change. I found out today that the position was filled by a friend of mine who openly admits to having less qualifications than I do. What bites my ass is that I was not even interviewed. I emailed the hiring manager and he told me that he didn't need to interview me because he already was "aware" of my qualifications from an interview (for a different position) last year. I plan to speak with the department manager on this tommorrow and possibly go to HR.

If qualifications were not a deciding factor in this position, then what was?