Since it began selling stents in 1996, Israeli med-tech company Medinol has accrued profits of about $600 million, according to calculations by TheMarker.com.

Medinol's financials, revealed here for the first time, show not only meteoric revenue growth but also profit margins of an extraordinary 90%, roughly speaking.

Jerusalem-based Medinol has the status of an approved enterprise. Among the benefits granted by its status, it does not owe tax on profits until distributing the money to shareholders.

The company's results shows that sales grew from around $30 million in 1996, when stent sales commenced in Europe, to a peak of $230 million in 1999.

But revenues slid to $140 million in 2000, and are expected to erode to half that sum this year, because of Medinol's soured relations with its sole marketer, Boston Scientific (NYSE:BSX).

In recent years Medinol has handed out $400 million worth of dividends, on which it paid both corporate tax and tax on dividends. Shareholders apparently received about $200 million in dividends after tax.

Medinol co-founders Kobi and Judith Richter apparently received something more than $100 million.

The company's extraordinary profitability derives from its unique production process, as well as its 25% share in income from sales of stents and associated equipment by Boston.

Medinol manages to produce its stents using a small fraction of the manpower employed by rivals. Altogether the Jerusalem-based company employs 150 people.

Stents are wire-mesh tubes used to prop open cardiac vessels after surgery.

Ami Ginzburg, Ha'aretz, adds:

The sale of Medinol to Boston Scientific fell through due to the American company's refusal to agree to a third-party payment guarantee, not because of the purchase price, Medinol principal owner Kobi Richter said at his unprecedented press conference yesterday.

Richter described his version of the events that resulted in mutual lawsuits between the two companies.

Richter said that the two sides had agreed on a purchase price for Medinol, but that his investment banker advised him not to agree to the conditions of sale Boston Scientific offered.

Medinol accuses Boston Scientific of allegedly stealing its patents and trying to reproduce its production line at a factory in Ireland.

According to Richter, negotiations to sell Medinol to Boston Scientific began back in 1997 and a purchase contract was almost signed for $1.2 billion in cash. But the American company's CEO decided against the deal in December 1997.

Richter said that the offer came as Medinol was preparing to conduct an initial public offer and that it suspended these IPO preparations after the acquisition bid was presented.

As late as March 2001, the two companies were still negotiating a possible deal for the sale of Medinol in the neighborhood of $2.2 billion to $2.5 billion. Boston Scientific was reportedly ready to pay half up front in cash and the other half after three years, conditional upon meeting defined milestones.