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MedNet Solutions Inc. is a Minnetonka company that's growing in double-digit spurts in an arcane niche of the medical software industry.

The product of a partnership of four veterans of the medical software wars hereabouts, MedNet has grown in six years to estimated 2007 sales of $7.5 million. Its product: customized websites that streamline the process of gathering and managing data for clinical trials run by pharmaceutical and medical device companies.

Ho-hum. So what's the big deal?

Well, less than a dozen years ago the typical clinical study involved a blizzard of paperwork that flowed back and forth between the medical personnel conducting the trials and the companies sponsoring them, said Rob Robertson, MedNet's CEO and a co-founder.

"In some cases, you could be talking a truckload of documents" that moved via fax, courier services and snail mail, he said. "And that meant significant time added to the process."

The cost of the delays could be eye-fetching, added Brian Sweeney, another MedNet founder, who labors as vice president of sales: "For some big pharmaceutical or medical device companies, delays could mean the loss of millions of dollars a day in sales."

MedNet isn't alone in the industry, mind you. And its chief competitors -- Phase Forward in North Carolina and Medidata in New York -- are much larger, counting their annual sales in eight or nine digits. That compares with MedNet's 2006 sales of $5.6 million.

Yet MedNet has latched onto some very large clients, including Twin Cities-based Medtronic, American Medical Systems and the Guidant segment of Boston Scientific, as well as such national heavies as Abbott Laboratories; Allergan Inc., the Botox developer; AstraZeneca, the pharmaceuticals giant, and Genentech, a biotechnology leader.

What's the attraction? David Dawson, senior director of science services for ImClone Systems, a New York-based biomedical company, lauded MedNet representatives as "a top-notch team" and added that "I wish all the other companies we work with were as professional as MedNet."

And what does that mean? "They are experts who can put all the pieces together and make the complex seem simple," said John Walt, senior manager of global health outcomes strategy at Allergan.

Walt, not to mention other clients and the MedNet investors, can thank software guru Paul Grady, a co-founder and the company's chief technology officer, for the simplicity.

Grady, who's based in Reno, Nev., at the company's advanced development laboratory, came up with the initial software design. The only flaw was that the early version required virtually total custom development for each client. Later improvements created a framework that allowed customization to be done quickly and easily.

And now, in the latest release, Grady and his team have come up with a software that allows nonprogrammers -- specifically, the company's project managers -- to create customized websites easily, without the involvement of comparatively scarce developer resouces.

The result is the potential for significantly higher profit margins, Robertson said.

The MedNet concept started with a telephone call received by Al Sherwood, an engineer and the fourth of the company's co-founders. It came from a friend, a California urologist who was seeking a way to automate the data collection and management process for a clinical study he was conducting.

Sherwood, now the company's senior vice president of research and development, started a series of calls to the other founders, all of whom had worked with him at Summit Medical Systems, a Twin Cities developer of health care data management software.

Robertson, Grady and Sweeney, who have been friends since childhood, jumped at the opportunity, joining with Sherwood to pool $70,000 from their savings for the start-up.

They later raised $350,000 from angel investors and in 2006 swung a $1 million convertible debenture offering to finance growth.

The company's growth over the years has ranged from spectacular to huzzah! depending on which year you use as the base for comparison.

If you compare 2006 revenue of $5.6 million to the 2002 gross of $250,000, you get an 80 percent annual growth rate that placed MedNet at No. 157 on Entrepreneur magazine's 2007 "Hot 500" list of the country's fastest-growing companies.

But if you compare last year's results to the $2 million gross in 2003, you get a still-impressive 40 percent annual growth rate -- but one that was worth no better than No. 2,059 on Inc. magazine's Inc. 5,000 list last year.

Dick Youngblood • 612-673-4439 • yblood@startribune.com