Sure it is possible there is a great chapter about that in the Professional WordPress Plugin Development book (http://www.amazon.de/Professional-WordPress-Plugin-Development-Williams/dp/0470916222). I’ve already got a system for my premium plugins like that.
Essentially you have to hook into the WordPress API requests and root them to your own API
Here is an example for premium plugins
https://gist.github.com/Horttcore/5197032
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