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DaVita HealthCare CFO resigns after settlements sting dialysis provider

In October 2014, the company agreed to pay $350 million and another $39 million in civil forfeiture to resolve claims it paid kickbacks.

Susan Morse, Senior Editor

Dialysis machineDialysis machine

DaVita HealthCare Partners CFO Garry Menzel has resigned to return to the biopharmaceutical industry, the company announced. The news comes after the company saw a slate of high-profile civil and criminal investigations over the past few years.

In October 2014, DaVita Healthcare Partners, a leading provider of dialysis services that has clinics in 46 states, agreed to pay $350 million and another $39 million in civil forfeiture to resolve claims it violated the False Claims Act by paying kickbacks to induce the referral of patients to its dialysis clinics, according to the U.S. Department of Justice.

DaVita also allegedly offered physician groups lucrative opportunities to partner with DaVita by acquiring and/or selling an interest in dialysis clinics to which their patients would be referred for treatment, according to the U.S. Department of Justice.

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The allegations were brought under the False Claims Act whistleblower provision in a lawsuit filed by a former senior financial analyst for DaVita, according to the Justice Department.

This February, the company settled a related case with four states, agreeing to pay $22 million, it stated.

Menzel said he would remain with the company to ensure a smooth transition as Chief Accounting Officer James Hilger takes over CFO duties on an interim basis, according to the Denver Post.

The change was effective Monday.

Menzel has been CFO since 2013, taking over from Hilger, who had served as DaVita's interim CFO.

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In announcing the news, DaVita said the company has "long maintained a strong finance leadership team" that will aid Hilger in "guiding and executing the financial strategy of the organization."

Menzel, who earned a Ph.D. in molecular biology from the University of Cambridge and a MBA from Stanford University, was previously COO and CFO at the biopharmaceutical company Regulus Therapeutics.

Menzel also had been a managing director and global head of life sciences for Credit Suisse and a managing director and global head of biotechnology for Goldman Sachs.

Twitter: @SusanMorseHFN