VirtualScopics (VSCP) 10-Q 15 May 14 2014 Q1 Quarterly report Financial data

Document_And_Entity_Informatio

Document And Entity Information	3 Months Ended
	Mar. 31, 2014	Apr. 30, 2014
Document Information [Line Items]	'	'
Entity Registrant Name	'VirtualScopics, Inc.	'
Entity Central Index Key	'0001307752	'
Current Fiscal Year End Date	'--12-31	'
Entity Filer Category	'Smaller Reporting Company	'
Trading Symbol	'VSCP	'
Entity Common Stock, Shares Outstanding	'	2,992,853
Document Type	'10-Q	'
Amendment Flag	'false	'
Document Period End Date	31-Mar-14	'
Document Fiscal Period Focus	'Q1	'
Document Fiscal Year Focus	'2014	'

Condensed_Consolidated_Balance

Condensed Consolidated Balance Sheets (USD $)	Mar. 31, 2014	Dec. 31, 2013
Current assets	'	'
Cash	$6,837,572	$7,330,630
Accounts receivable, net	1,642,792	1,725,070
Prepaid expenses and other current assets	432,467	397,699
Total current assets	8,912,831	9,453,399
Patents, net	1,306,034	1,334,420
Property and equipment, net	198,171	221,700
Other assets	0	'
Total assets	10,417,036	11,009,519
Current liabilities	'	'
Accounts payable and accrued expenses	958,253	846,071
Accrued payroll	495,972	837,611
Unearned revenue	1,028,987	745,028
Dividends payable	293,333	293,333
Total current liabilities	2,776,545	2,722,043
Commitments and Contingencies	'	'
Stockholders' Equity	'	'
Common stock, $0.001 par value; 85,000,000 shares authorized; issued 2,992,853 shares at March 31, 2014 and December 31, 2013, respectively; outstanding, 2,992,853 and 2,991,869 shares at March 31, 2014 and December 31, 2013, respectively	2,993	2,992
Additional paid-in capital	21,992,006	21,992,619
Accumulated deficit	-14,354,514	-13,708,141
Total stockholders' equity	7,640,491	8,287,476
Total liabilities and stockholders' equity	10,417,036	11,009,519
Convertible Preferred Stock Series A [Member]	'	'
Stockholders' Equity	'	'
Convertible preferred stock	2	2
Convertible Preferred Stock Series B [Member]	'	'
Stockholders' Equity	'	'
Convertible preferred stock	1	1
Convertible Preferred Stock Series C - 1 [Member]	'	'
Stockholders' Equity	'	'
Convertible preferred stock	3	3
Convertible Preferred Stock Series C - 2 [Member]	'	'
Stockholders' Equity	'	'
Convertible preferred stock	$0	$0

Condensed_Consolidated_Balance1

Condensed Consolidated Balance Sheets [Parenthetical] (USD $)	Mar. 31, 2014	Dec. 31, 2013
Convertible preferred stock, par value (in dollars per share)	$0.00	$0.00
Convertible preferred stock, shares authorized	15,000,000	15,000,000
Common stock, par value (in dollars per share)	$0.00	$0.00
Common stock, shares authorized	85,000,000	85,000,000
Common stock, shares Issued	2,992,853	2,992,853
Common stock, shares outstanding	2,992,853	2,991,869
Convertible Preferred Stock Series A [Member]	'	'
Convertible preferred stock, shares authorized	8,400	8,400
Convertible preferred stock, shares issued	2,190	2,190
Convertible preferred stock, shares outstanding	2,190	2,190
Convertible preferred stock, liquidation preference (in dollars per share)	$1,000	$1,000
Convertible Preferred Stock Series B [Member]	'	'
Convertible preferred stock, shares authorized	6,000	6,000
Convertible preferred stock, shares issued	600	600
Convertible preferred stock, shares outstanding	600	600
Convertible preferred stock, liquidation preference (in dollars per share)	$1,000	$1,000
Convertible Preferred Stock Series C - 1 [Member]	'	'
Convertible preferred stock, shares authorized	3,000	3,000
Convertible preferred stock, shares issued	3,000	3,000
Convertible preferred stock, shares outstanding	3,000	3,000
Convertible preferred stock, liquidation preference (in dollars per share)	$1,000	$1,000
Convertible Preferred Stock Series C - 2 [Member]	'	'
Convertible preferred stock, shares authorized	3,000	3,000
Convertible preferred stock, shares issued	0	0
Convertible preferred stock, shares outstanding	0	0
Convertible preferred stock, liquidation preference (in dollars per share)	$1,000	$1,000

Condensed_Consolidated_Stateme

Condensed Consolidated Statements of Operations (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Revenues	$2,246,954	$2,282,831
Reimbursement revenues	106,032	249,756
Total revenues	2,352,986	2,532,587
Cost of services	1,489,079	1,497,539
Cost of reimbursement revenues	106,032	249,756
Total cost of services	1,595,111	1,747,295
Gross profit	757,875	785,292
Operating expenses	'	'
Research and development	285,896	453,411
Sales and marketing	345,077	357,652
General and administrative	687,002	995,302
Depreciation and amortization	86,502	96,313
Total operating expenses	1,404,477	1,902,678
Operating loss	-646,602	-1,117,386
Other income (expense)	'	'
Other income	1,037	5,880
Other expense	-808	-1,442
Total other income	229	4,438
Net loss	-646,373	-1,112,948
Preferred stock dividends	42,000	42,000
Net loss available to common stockholders	($688,373)	($1,154,948)
Weighted average basic and diluted shares outstanding (in shares)	2,991,990	2,979,952
Basic and diluted loss per share (in dollars per share)	($0.23)	($0.39)

Condensed_Consolidated_Stateme1

Condensed Consolidated Statements of Cash Flows (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Cash flows from operating activities	'	'
Net loss	($646,373)	($1,112,948)
Adjustments to reconcile net loss to net cash used in operating activities:	'	'
Depreciation and amortization	86,502	96,313
Loss on the disposal of assets	0	12,187
Stock-based compensation	41,388	140,787
Changes in operating assets and liabilities	'	'
Accounts receivable	82,278	-406,477
Prepaid expenses and other assets	-34,768	-16,990
Accounts payable and accrued expenses	112,182	130,190
Accrued payroll	-341,639	-50,177
Unearned revenue	283,959	-24,210
Total adjustments	229,902	-118,377
Net cash used in operating activities	-416,471	-1,231,325
Cash flows from investing activities	'	'
Purchases of property and equipment	-28,563	-23,069
Patent applications and maintenance	-6,024	-4,353
Net cash used in investing activities	-34,587	-27,422
Cash flows from financing activities	'	'
Cash dividends on series B preferred stock	-42,000	0
Net cash used in financing activities	-42,000	0
Net decrease in cash	-493,058	-1,258,747
Cash	'	'
Beginning of period	7,330,630	8,523,807
End of period	6,837,572	7,265,060
Non-cash financing activity:	'	'
Accrued dividends on series B and C-1 preferred stock	$0	$42,000

Nature_of_Business_and_Basis_o

Nature of Business and Basis of Presentation	3 Months Ended
	Mar. 31, 2014
Organization and Basis Of Presentation [Abstract]	'
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]	'
	NOTE 1 - Nature of Business and Basis of Presentation
	Nature of Business
	The headquarters of VirtualScopics. Inc. and Subsidiary (the “Company”) are located in Rochester, New York. The Company has created a suite of image analysis software tools and applications which are used in detecting and measuring specific anatomical structures and metabolic activity using medical images. The Company’s developed proprietary software provides measurement capabilities designed to improve pharmaceutical and medical device research and development and improve clinical medical image analysis.
	Basis of Presentation
	The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for condensed financial statements and should be read in conjunction with the audited consolidated financial statements and notes related thereto contained in the Company’s Annual Report on Form 10-K as of and for the year ended December 31, 2013. In the opinion of management, these financial statements contain all adjustments necessary for a fair presentation for the interim period, all of which were normal recurring adjustments. The results of operations for the three months ended March 31, 2014 are not necessarily indicative of the results to be expected for the full year ending December 31, 2014.
	A Certificate of Amendment to effect a reverse stock split was approved by the Company's stockholders at its Annual Meeting of Stockholders held on August 13, 2013.  The Company's stockholders granted the Board authority to effectuate a reverse stock split at a ratio of between 1-for-2 to 1-for-10. The Company’s Board of Directors subsequently approved a 1-for-10 reverse stock split of the Company’s outstanding common stock that was effected on August 21, 2013. Corresponding adjustments were made to the number of shares of common stock underlying the Company’s outstanding options, warrants, and preferred stock exercisable for or convertible into common stock and the related long-term incentive plans for such options. All share and related option information presented in these financial statements and accompanying footnotes have been retroactively adjusted to reflect the reduced number of shares resulting from this action.

Summary_of_Certain_Significant

Summary of Certain Significant Accounting Policies	3 Months Ended
	Mar. 31, 2014
Accounting Policies [Abstract]	'
Significant Accounting Policies [Text Block]	'
	NOTE 2 - Summary of Certain Significant Accounting Policies
	Principles of Consolidation
	The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, VirtualScopics, LLC. All significant intercompany balances and transactions have been eliminated in consolidation.
	Revenue Recognition
	The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when an agreement exists, services and products have been performed, prices are fixed or determinable, and collectability is reasonably assured. Revenues are reduced for estimated discounts and other allowances, if any.
	The Company provides advanced medical image analysis on a per analysis basis, and recognizes revenue when the image analysis is completed. Revenue related to project, data and site management services is recognized as the services are rendered and in accordance with the terms of the contract. Consulting revenue is recognized once the services are rendered and typically charged as an hourly rate.
	Occasionally, the Company has provided software development services to its customers, which may require development, modification, and customization. Software development revenue is billed on a fixed price basis and recognized upon delivery of the software and acceptance by the customer on a completed contract basis. The Company does not sell software licenses, upgrades or enhancements, or post-contract customer services.
	Reimbursements received and related costs incurred for out-of-pocket expenses are separately reported as revenue and cost of services, respectively, in the financial statements.
	Income Taxes
	In its interim financial statements, the Company follows the guidance of ASC 270 “Interim Reporting” and ASC 740 “Income Taxes” whereby it uses the expected annual effective tax rate in determining its interim tax provisions. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income and the reversal of deferred tax liabilities during the period in which related temporary differences become deductible. The benefit of tax positions taken or expected to be taken in the Company’s income tax returns are recognized in the consolidated financial statements if such positions are more likely than not of being sustained.
	Research and Development
	Research and development expense relates to the development of new applications and processes including improvements and enhancements to existing software applications. These costs are expensed as incurred.
	Reclassifications
	The Company has reclassified certain amounts from its previously reported condensed consolidated financial statements for comparative purposes to conform to the fiscal 2014 presentation. These reclassifications had no impact on the Company’s previously reported condensed consolidated results from operations or cash flows.
	Fair Value of Financial Instruments
	Fair value of financial instruments is defined as an exit price, which is the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date. The degree of judgment utilized in measuring the fair value of assets and liabilities generally correlates to the level of pricing observability. Financial assets and liabilities with readily available, actively quoted prices or for which fair value can be measured from actively quoted prices in active markets generally have more pricing observability and require less judgment in measuring fair value. Conversely, financial assets and liabilities that are rarely traded or not quoted have less price observability and are generally measured at fair value using valuation models that require more judgment. These valuation techniques involve some level of management estimation and judgment, the degree of which is dependent on the price transparency of the asset, liability or market and the nature of the asset or liability. The Company has categorized its financial assets and liabilities measured at fair value into a three-level hierarchy.

StockBased_Compensation

Stock-Based Compensation	3 Months Ended
	Mar. 31, 2014
Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]	'
Disclosure of Compensation Related Costs, Share-based Payments [Text Block]	'
	NOTE 3 - Stock-Based Compensation
	For the three months ended March 31, 2014 and 2013, the Company’s condensed consolidated statements of operations reflect stock-based compensation expense for stock options granted under its long-term incentive plans and allocated as follows:
		Three Months Ending
		March 31,
		2014			2013
	Cost of service revenues	$	11,041		$	12,842
	Research and development		9,573			19,565
	Sales and marketing		2,691			3,044
	General and administrative		17,524			100,331
	Total stock-based compensation	$	40,829		$	135,782
	Stock options issued under the Company’s long-term incentive plans are granted with an exercise price equal but no less than the market price of the Company’s stock at the date of grant and expire up to ten years from the date of grant. These options generally vest over a three or four-year period. As of March 31, 2014, there was $160,899 of total unrecognized compensation cost related to non-vested share-based compensation arrangements. This cost is expected to be recognized over a weighted-average period of 1.72 years.
	The fair value of stock options granted was determined on the grant date using assumptions for risk free interest rate, the expected term, expected volatility, and expected dividend yield. The risk free interest rate is based on U.S. Treasury zero-coupon yield curve over the expected term of the option. The expected term assumption is determined using the weighted average midpoint between the vesting and expiration term for all individuals within the grant. The Company estimated its expected volatility using its own historical stock prices. The Company’s model includes a zero dividend yield assumption, as the Company has not historically paid nor does it anticipate paying dividends on its common stock. The Company’s model does not include a discount for post-vesting restrictions, as the Company has not issued awards with such restrictions. The periodic expense is then determined based on the valuation of the options, and at that time an estimated forfeiture rate is used to reduce the expense recorded. The Company’s estimate of pre-vesting forfeitures is primarily based on the Company’s historical experience and is adjusted to reflect actual forfeitures as the options vest. The following assumptions were used to estimate the fair value of options granted for the three months ended March 31, 2014 and 2013 using the Black-Scholes option-pricing model:
		March 31,
		2014		2013
	Risk free interest rate	1.9	%	1.3	%
	Expected term (years)	5.9		6.6
	Expected volatility	64.5	%	68.3	%
	Expected dividend yield	-		-
	A summary of the employee stock option activity for the three months ended March 31, 2014 is as follows:
		Number of		Weighted			Weighted
		Shares		Average			Average
				Exercise			Remaining
				Price			Contractual
							Term
	Options outstanding at January 1, 2014	425,875		$	12.72
	Granted	1,250			3.4
	Exercised	-
	Cancelled/Forfeited	-179,829			-10.22
	Expired	-316			-23.6
	Options outstanding at March 31, 2014	246,980			14.48		4.59
	Options exercisable at March 31, 2014	207,906			15.06		4
	As of March 31, 2014 and 2013, the Company had options outstanding to consultants of 22 and 120, respectively.
	The weighted-average grant-date fair value of options granted during the three months ended March 31, 2014 and 2013 was $2,511 and $5,632, respectively.

Stockholders_Equity

Stockholders' Equity	3 Months Ended
	Mar. 31, 2014
Stockholders Equity Note [Abstract]	'
Stockholders' Equity Note Disclosure [Text Block]	'
	NOTE 4 - Stockholders’ Equity
	The Company has authorized 15,000,000 shares of preferred stock, par value $0.001 per share, of which 8,400 are designated as Series A Convertible Preferred Stock (“Series A”), 6,000 are designated as Series B Convertible Preferred Stock (“Series B”), 3,000 are designated as Series C-1 Convertible Preferred Stock (“Series C-1”), and 3,000 are designated as Series C-2 Convertible Preferred Stock (“Series C-2”) as specified in the Certificate of Designation (the “Certificate”). During the three months ended March 31, 2014 and 2013, there were no conversions of the Company’s convertible preferred stock.
	Each share of Series A is convertible into 83.036 shares of the Company’s common stock and is senior in liquidation preference in comparison to shares of the Company’s common stock.
	Each share of Series B is convertible into 83.036 shares of the Company’s common stock and has a liquidation preference that is pari passu with the Company’s Series A and senior to the Company’s common stock. Cumulative dividends on the Series B accrue on the stated value of $1,000 per share at an annual rate of 8%, payable monthly in cash and/or shares of the Company’s common stock at the option of the Company. Subject to certain exceptions, the Series B holders are only entitled to be paid dividends, if full dividends are first paid or concurrently paid to the holders of the Series C-1. As of March 31, 2014 and December 31, 2013, there were $84,000 of dividends payable to Series B stockholders. During the three months ended March 31, 2014 and 2013, cash dividends paid to Series B stockholders aggregated to $12,000 and $0, respectively.
	Each share of Series C-1 is convertible into shares of the Company’s common stock at a conversion rate determined by dividing (i) the stated value per share of $1,000, plus, if consented to by the Company, all accrued and unpaid dividends, by (ii) the conversion price of $12.043. The Series C-1 is senior in liquidation preference in comparison to shares of the Company’s common stock. Cumulative dividends on the Series C accrue on the stated value of $1,000 per share at an annual rate of 4%. As of March 31, 2014 and December 31, 2013, there were $209,333 of dividends payable to Series C-1 stockholders. During the three months ended March 31, 2014 and 2013, cash dividends paid to Series C-1 stockholders aggregated to $30,000 and $0, respectively.
	Restricted Stock Awards
	A restricted stock award entitles the recipient to receive shares of unrestricted common stock upon vesting of the award and expiration of the restrictions. The fair value of each restricted stock award is determined upon granting of the shares and the related compensation expense is recognized ratably over the vesting period and charged to the operations as non-cash compensation expense. Shares contained in the unvested portion of restricted stock awards are forfeited upon termination of employment, unless otherwise agreed. The fair value of restricted stock issued under the Plan is determined based on the closing price of the Company’s common stock on the grant date.
	A summary of the restricted stock award activity for the three months ended March 31, 2014 is as follows:
		Number	Weighted
		of Units	Average
			Grant
			Date Fair
			Value
	Nonvested at January 1, 2014	984	7.4
	Granted	-
	Vested	-984	-7.4
	Cancelled/Forfeited	-
	Nonvested at March 31, 2014	-
	The Company incurred $559 and $5,005 in compensation expense during the three months ended March 31, 2014 and 2013, respectively, related to the restricted stock awards granted to Board members and former officers of the Company. During the three months ended March 31, 2014, 984 restricted stock units vested as part of the former CFO’s consulting agreement.

Loss_Per_Share

Loss Per Share	3 Months Ended
	Mar. 31, 2014
Earnings Per Share [Abstract]	'
Earnings Per Share [Text Block]	'
	NOTE 5 – Loss Per Share
	Basic earnings and loss per share are computed by dividing the net income or loss available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options (using the treasury stock method) and the conversion of the Company’s convertible preferred stock and warrants (using the if-converted method). Diluted loss per share excludes the shares issuable upon the conversion of preferred stock, the exercise of stock options and warrants from the calculation of net loss per share as their effect would be antidilutive.
	Securities that could potentially dilute earnings per share in the future that were not included in the computation of diluted loss per share consist of the following numbers of shares into which preferred stock could have been converted and shares for which outstanding options and warrants could have been exercised during the three months ending March 31, 2014 and 2013:
		2014	2013
	Convertible preferred stock	480,777	480,777
	Warrants to purchase common stock	233,753	238,302
	Non-vested restricted stock awards	-	15,927
	Options to purchase common stock	247,002	596,000
	Total	961,532	1,331,006

Income_Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2014
Income Tax Disclosure [Abstract]	'
Income Tax Disclosure [Text Block]	'
	NOTE 6 - Income Taxes
	The Company has significant net operating loss and business credit carryovers which are subject to a valuation allowance due to the uncertain nature of the realization of the losses. The Internal Revenue Code imposes certain limitations on the utilization of net operating loss carryovers and other tax attributes after a change in control. The Company does not believe it has encountered ownership changes which could significantly limit the possible utilization of such carryovers. It is not anticipated that limitations, if any, would have a material impact on the condensed consolidated balance sheet as a result of offsetting changes in the deferred tax valuation allowance. Based on all available evidence, the Company believes that its deferred tax assets should be fully reserved as of March 31, 2014 because it is still currently more likely than not that the benefits of the Company’s deferred tax assets will not be realized in future periods. The Company will continue to assess the likelihood of recognizing a portion of its deferred tax assets and will make an assessment of whether it should reduce the valuation allowance.
	The Company will recognize interest and penalties accrued related to unrecognized tax benefits as components of its income tax provision. As of March 31, 2014, the Company does not have any interest and penalties accrued related to unrecognized tax benefits.

Concentration_of_Credit_Risk

Concentration of Credit Risk	3 Months Ended
	Mar. 31, 2014
Risks and Uncertainties [Abstract]	'
Concentration Risk Disclosure [Text Block]	'
	NOTE 7 - Concentration of Credit Risk
	The Company’s top three customers accounted for approximately 32%, 23%, and 14% of total revenue for the three months ended March 31, 2014. Three customers accounted for 32%, 14%, and 11% of total revenue for the three months ended March 31, 2013.
	Two customers accounted for approximately 36% and 32% of accounts receivable as of March 31, 2014 as compared to the three customers accounting for 45%, 12%, and 12% of accounts receivable as of March 31, 2013.

Related_Party

Related Party	3 Months Ended
	Mar. 31, 2014
Related Party Transactions [Abstract]	'
Related Party Transactions Disclosure [Text Block]	'
	NOTE 8 – Related Party
	In April 2012, the Company issued Merck Global Health Innovation Fund, LLC (“Merck”) 3,000 shares of Series C-1 which are convertible into 249,107 shares of common stock and Series C-1 Warrants which are exercisable to purchase 136,132 shares of common stock. Revenues generated from Merck were $23,115 and $95,643 for the three months ended March 31, 2014 and 2013, respectively. The accounts receivable balance due from Merck was $1,750 and $87,200 as of March 31, 2014 and December 31, 2013, respectively.

Subsequent_Events

Subsequent Events	3 Months Ended
	Mar. 31, 2014
Subsequent Events [Abstract]	'
Subsequent Events [Text Block]	'
	NOTE 9 - Subsequent Events
	The Company evaluates events that have occurred after the balance sheet date but before the financial statements are issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the condensed consolidated financial statements.

Summary_of_Certain_Significant1

Summary of Certain Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2014
Accounting Policies [Abstract]	'
Consolidation, Policy [Policy Text Block]	'
	Principles of Consolidation
	The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, VirtualScopics, LLC. All significant intercompany balances and transactions have been eliminated in consolidation.
Revenue Recognition, Policy [Policy Text Block]	'
	Revenue Recognition
	The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when an agreement exists, services and products have been performed, prices are fixed or determinable, and collectability is reasonably assured. Revenues are reduced for estimated discounts and other allowances, if any.
	The Company provides advanced medical image analysis on a per analysis basis, and recognizes revenue when the image analysis is completed. Revenue related to project, data and site management services is recognized as the services are rendered and in accordance with the terms of the contract. Consulting revenue is recognized once the services are rendered and typically charged as an hourly rate.
	Occasionally, the Company has provided software development services to its customers, which may require development, modification, and customization. Software development revenue is billed on a fixed price basis and recognized upon delivery of the software and acceptance by the customer on a completed contract basis. The Company does not sell software licenses, upgrades or enhancements, or post-contract customer services.
	Reimbursements received and related costs incurred for out-of-pocket expenses are separately reported as revenue and cost of services, respectively, in the financial statements.
Income Tax, Policy [Policy Text Block]	'
	Income Taxes
	In its interim financial statements, the Company follows the guidance of ASC 270 “Interim Reporting” and ASC 740 “Income Taxes” whereby it uses the expected annual effective tax rate in determining its interim tax provisions. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income and the reversal of deferred tax liabilities during the period in which related temporary differences become deductible. The benefit of tax positions taken or expected to be taken in the Company’s income tax returns are recognized in the consolidated financial statements if such positions are more likely than not of being sustained.
Research and Development Expense, Policy [Policy Text Block]	'
	Research and Development
	Research and development expense relates to the development of new applications and processes including improvements and enhancements to existing software applications. These costs are expensed as incurred.
Reclassification, Policy [Policy Text Block]	'
	Reclassifications
	The Company has reclassified certain amounts from its previously reported condensed consolidated financial statements for comparative purposes to conform to the fiscal 2014 presentation. These reclassifications had no impact on the Company’s previously reported condensed consolidated results from operations or cash flows.
Fair Value of Financial Instruments, Policy [Policy Text Block]	'
	Fair Value of Financial Instruments
	Fair value of financial instruments is defined as an exit price, which is the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date. The degree of judgment utilized in measuring the fair value of assets and liabilities generally correlates to the level of pricing observability. Financial assets and liabilities with readily available, actively quoted prices or for which fair value can be measured from actively quoted prices in active markets generally have more pricing observability and require less judgment in measuring fair value. Conversely, financial assets and liabilities that are rarely traded or not quoted have less price observability and are generally measured at fair value using valuation models that require more judgment. These valuation techniques involve some level of management estimation and judgment, the degree of which is dependent on the price transparency of the asset, liability or market and the nature of the asset or liability. The Company has categorized its financial assets and liabilities measured at fair value into a three-level hierarchy.

StockBased_Compensation_Tables

Stock-Based Compensation (Tables)	3 Months Ended
	Mar. 31, 2014
Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]	'
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block]	'
	For the three months ended March 31, 2014 and 2013, the Company’s condensed consolidated statements of operations reflect stock-based compensation expense for stock options granted under its long-term incentive plans and allocated as follows:
		Three Months Ending
		March 31,
		2014			2013
	Cost of service revenues	$	11,041		$	12,842
	Research and development		9,573			19,565
	Sales and marketing		2,691			3,044
	General and administrative		17,524			100,331
	Total stock-based compensation	$	40,829		$	135,782
Schedule of Share-based Compensation, Activity [Table Text Block]	'
	The following assumptions were used to estimate the fair value of options granted for the three months ended March 31, 2014 and 2013 using the Black-Scholes option-pricing model:
		March 31,
		2014		2013
	Risk free interest rate	1.9	%	1.3	%
	Expected term (years)	5.9		6.6
	Expected volatility	64.5	%	68.3	%
	Expected dividend yield	-		-
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block]	'
	A summary of the employee stock option activity for the three months ended March 31, 2014 is as follows:
		Number of		Weighted			Weighted
		Shares		Average			Average
				Exercise			Remaining
				Price			Contractual
							Term
	Options outstanding at January 1, 2014	425,875		$	12.72
	Granted	1,250			3.4
	Exercised	-
	Cancelled/Forfeited	-179,829			-10.22
	Expired	-316			-23.6
	Options outstanding at March 31, 2014	246,980			14.48		4.59
	Options exercisable at March 31, 2014	207,906			15.06		4

Stockholders_Equity_Tables

Stockholders' Equity (Tables)	3 Months Ended
	Mar. 31, 2014
Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]	'
Schedule Of Share Based Compensation Non Vested Stock Options Activity [Table Text Block]	'
	A summary of the restricted stock award activity for the three months ended March 31, 2014 is as follows:
		Number	Weighted
		of Units	Average
			Grant
			Date Fair
			Value
	Nonvested at January 1, 2014	984	7.4
	Granted	-
	Vested	-984	-7.4
	Cancelled/Forfeited	-
	Nonvested at March 31, 2014	-

Loss_Per_Share_Tables

Loss Per Share (Tables)	3 Months Ended
	Mar. 31, 2014
Earnings Per Share [Abstract]	'
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block]	'
	Securities that could potentially dilute earnings per share in the future that were not included in the computation of diluted loss per share consist of the following numbers of shares into which preferred stock could have been converted and shares for which outstanding options and warrants could have been exercised during the three months ending March 31, 2014 and 2013:
		2014	2013
	Convertible preferred stock	480,777	480,777
	Warrants to purchase common stock	233,753	238,302
	Non-vested restricted stock awards	-	15,927
	Options to purchase common stock	247,002	596,000
	Total	961,532	1,331,006

Nature_of_Business_and_Basis_o1

Nature of Business and Basis of Presentation (Details Textual)	0 Months Ended
	Aug. 13, 2013
Stockholders Equity, Reverse Stock Split	'1-for-10

StockBased_Compensation_Detail

Stock-Based Compensation (Details) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Long-Term Incentive Plans [Member]	'	'
Stock-based compensation	$40,829	$135,782
Cost of service revenues [Member]	'	'
Stock-based compensation	11,041	12,842
Research and development [Member]	'	'
Stock-based compensation	9,573	19,565
Sales and marketing [Member]	'	'
Stock-based compensation	2,691	3,044
General and administrative [Member]	'	'
Stock-based compensation	$17,524	$100,331

StockBased_Compensation_Detail1

Stock-Based Compensation (Details 1)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Risk free interest rate	1.90%	1.30%
Expected term (in years)	'5 years 10 months 24 days	'6 years 7 months 6 days
Expected volatility	64.50%	68.30%
Expected dividend yield	0.00%	0.00%

StockBased_Compensation_Detail2

Stock-Based Compensation (Details 2) (USD $)	3 Months Ended
	Mar. 31, 2014
Options outstanding at January 1, 2014	425,875
Granted - Number of Shares	1,250
Exercised - Number of Shares	0
Cancelled/Forfeited - Number of Shares	-179,829
Expired - Number of Shares	-316
Options outstanding at March 31, 2014	246,980
Options exercisable at March 31, 2014	207,906
Beginning balance, Options outstanding - Exercise price	$12.72
Granted - Weighted Average Exercise Price	$3.40
Cancelled/Forfeited - Weighted Average Exercise Price	($10.22)
Expired - Weighted Average Exercise Price	($23.60)
Ending balance, Options outstanding - Exercise price	$14.48
Exercisable, Weighted Average Exercise Price	$15.06
Stock Option, Weighted Average Remaining Life (Years)	'4 years 7 months 2 days
Options exercisable - Weighted Average Remaining Contractual Term (in years)	'4 years

StockBased_Compensation_Detail3

Stock-Based Compensation (Details Textual) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Share Based Compensation Options Grants In Period Weighted Average Grant Date Fair Value	$2,511	$5,632	'
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Total	$160,899	'	'
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition	'1 year 8 months 19 days	'	'
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Beginning Balance	246,980	'	425,875
Consultant [Member]	'	'	'
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Beginning Balance	22	120	'

Stockholders_Equity_Details

Stockholders' Equity (Details) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Non-vested	984	'
Granted, Number of Units	0	'
Vested, Number of Units	-984	'
Cancelled/Forfeited, Number of Units	0	'
Non-vested	0	'
Weighted Average Grant Date Fair Value, Non-Vested (in dollars per share)	'	$7.40
Weighted Average Grant Date Fair Value, Vested (in dollars per share)	($7.40)	'

Stockholders_Equity_Details_Te

Stockholders' Equity (Details Textual) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Convertible preferred stock, shares authorized	15,000,000	'	15,000,000
Preferred Stock, Par or Stated Value Per Share	$0.00	'	$0.00
Cash dividends on preferred stock	$42,000	$0	'
Chief Financial Officer [Member]	'	'	'
Stock Issued During Period, Shares, Restricted Stock Award, Gross	984	'	'
Restricted Stock Units (RSUs) [Member]	'	'	'
Stock-based compensation	559	5,005	'
Series A Convertible Preferred Stock [Member]	'	'	'
Preferred Stock Designated During Period Shares	8,400	'	'
Stock Conversion Ratio	83.036	'	'
Series C-1 Convertible Preferred Stock [Member]	'	'	'
Preferred Stock Designated During Period Shares	3,000	'	'
Preferred Stock, Liquidation Preference Per Share	$1,000	'	'
Preferred Stock Conversion Price Per Share	$12.04	'	'
Interest and Dividends Payable, Total	209,333	'	209,333
Cash dividends on preferred stock	30,000	0	'
Series C-1 Preferred Stock [Member]	'	'	'
Preferred Stock, Liquidation Preference Per Share	$1,000	'	'
Preferred Stock, Dividend Rate, Percentage	4.00%	4.00%	'
Series C-2 Convertible Preferred Stock [Member]	'	'	'
Convertible preferred stock, shares authorized	3,000	'	3,000
Preferred Stock Designated During Period Shares	3,000	'	'
Preferred Stock, Liquidation Preference Per Share	$1,000	'	$1,000
Series B Convertible Preferred Stock [Member]	'	'	'
Preferred Stock Designated During Period Shares	6,000	'	'
Preferred Stock, Liquidation Preference Per Share	$1,000	'	'
Interest and Dividends Payable, Total	84,000	'	84,000
Stock Conversion Ratio	83.036	'	'
Annual Dividend Rate	8.00%	'	'
Cash dividends on preferred stock	$12,000	$0	'

Loss_Per_Share_Details

Loss Per Share (Details)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	961,532	1,331,006
Convertible preferred stock [Member]	'	'
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	480,777	480,777
Warrants to purchase common stock [Member]	'	'
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	233,753	238,302
Non-vested restricted stock awards [Member]	'	'
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	0	15,927
Options to purchase common stock [Member]	'	'
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	247,002	596,000

Concentration_of_Credit_Risk_D

Concentration of Credit Risk (Details Textual)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Customer 1 [Member]	'	'
Entity-Wide Accounts Receivable, Major Customer, Percentage	36.00%	45.00%
Concentration Risk, Percentage	32.00%	32.00%
Customer 2 [Member]	'	'
Entity-Wide Accounts Receivable, Major Customer, Percentage	32.00%	12.00%
Concentration Risk, Percentage	23.00%	14.00%
Customer 3 [Member]	'	'
Entity-Wide Accounts Receivable, Major Customer, Percentage	'	12.00%
Concentration Risk, Percentage	14.00%	11.00%

Related_Party_Details_Textual

Related Party (Details Textual) (Merck Global Health Innovation Fund Llc [Member], USD $)	1 Months Ended	3 Months Ended
	Apr. 30, 2012	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Common stock issuable upon conversion of preferred stock	249,107	'	'	'
Revenue from Related Parties	'	$23,115	$95,643	'
Accounts Receivable, Related Parties	'	$1,750	'	$87,200
Series C-1 Preferred Stock [Member]	'	'	'	'
Preferred Stock and Warrant Purchase Agreement Shares Issued	3,000	'	'	'
Series C-1 Warrants [Member]	'	'	'	'
Preferred Stock and Warrant Purchase Agreement, Warrants Issued To Acquire Common Stock Shares, Number	136,132	'	'	'