Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 11, 2015 | |
Document Information [Line Items] | ||
Entity Registrant Name | VirtualScopics, Inc. | |
Entity Central Index Key | 1,307,752 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Trading Symbol | VSCP | |
Entity Common Stock, Shares Outstanding | 3,003,231 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2015 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,015 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets | ||
Cash | $ 1,699,579 | $ 4,046,599 |
Accounts receivable, net | 2,548,082 | 1,814,143 |
Prepaid expenses and other current assets | 477,106 | 410,188 |
Total current assets | 4,724,767 | 6,270,930 |
Patents, net | 1,065,494 | 1,211,770 |
Property and equipment, net | 518,572 | 330,873 |
Other Assets | 4,133 | 10,661 |
Total assets | 6,312,966 | 7,824,234 |
Current liabilities | ||
Accounts payable and accrued expenses | 739,240 | 1,289,099 |
Accrued payroll | 489,361 | 681,964 |
Unearned revenue | 688,778 | 670,332 |
Dividends payable | 335,333 | 335,333 |
Current portion of note payable | 59,968 | 0 |
Current portion of capital lease obligation | 23,830 | 0 |
Total current liabilities | 2,336,510 | 2,976,728 |
Note payable, net of current portion | 140,392 | 0 |
Capital lease obligation, net of current portion | 120,945 | 0 |
Total liabilities | $ 2,597,847 | $ 2,976,728 |
Commitments and Contingencies | ||
Stockholders' Equity | ||
Common stock, $0.001 par value; 20,000,000 shares authorized; issued and outstanding, 2,994,928 shares at September 30, 2015 and December 31, 2014 | $ 2,995 | $ 2,995 |
Additional paid-in capital | 21,967,125 | 21,975,069 |
Accumulated deficit | (18,255,007) | (17,130,564) |
Total stockholders' equity | 3,715,119 | 4,847,506 |
Total liabilities and stockholders' equity | 6,312,966 | 7,824,234 |
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 Balance3
Condensed Consolidated Balance Sheets [Parenthetical] - $ / shares | Sep. 30, 2015 | Dec. 31, 2014 |
Convertible preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Convertible preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 20,000,000 | 20,000,000 |
Common stock, shares issued | 2,994,928 | 2,994,928 |
Common stock, shares outstanding | 2,994,928 | 2,994,928 |
Convertible Preferred Stock Series A [Member] | ||
Convertible preferred stock, shares authorized | 8,400 | 8,400 |
Convertible preferred stock, shares issued | 2,165 | 2,165 |
Convertible preferred stock, shares outstanding | 2,165 | 2,165 |
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 Statemen
Condensed Consolidated Statements of Operations - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenues | $ 3,063,053 | $ 2,502,413 | $ 8,558,865 | $ 7,291,415 |
Reimbursement revenues | 161,354 | 238,828 | 499,110 | 451,559 |
Total revenues | 3,224,407 | 2,741,241 | 9,057,975 | 7,742,974 |
Cost of services | 1,696,940 | 1,573,790 | 5,208,813 | 4,664,548 |
Cost of reimbursement revenues | 161,354 | 238,828 | 499,110 | 451,559 |
Total cost of services | 1,858,294 | 1,812,618 | 5,707,923 | 5,116,107 |
Gross profit | 1,366,113 | 928,623 | 3,350,052 | 2,626,867 |
Operating expenses | ||||
Research and development | 324,669 | 307,470 | 972,962 | 899,655 |
Sales and marketing | 277,190 | 545,172 | 918,567 | 1,373,056 |
General and administrative | 673,960 | 957,795 | 2,252,729 | 2,452,438 |
Depreciation and amortization | 101,459 | 74,106 | 304,451 | 236,135 |
Total operating expenses | 1,377,278 | 1,884,543 | 4,448,709 | 4,961,284 |
Operating loss | (11,165) | (955,920) | (1,098,657) | (2,334,417) |
Other (expense) income | ||||
Other income | 15 | 1,030 | 935 | 3,087 |
Interest expense | (4,332) | 0 | (4,332) | |
Interest expense - debt issuance costs | (6,968) | 0 | (6,968) | |
Other expense | (2,329) | (633) | (15,421) | (2,097) |
Total other (expense) income | (13,614) | 397 | (25,786) | 990 |
Net loss | (24,779) | (955,523) | (1,124,443) | (2,333,427) |
Preferred stock dividends | 42,000 | 42,000 | 126,000 | 126,000 |
Net loss available to common stockholders | $ (66,779) | $ (997,523) | $ (1,250,443) | $ (2,459,427) |
Weighted average basic and diluted shares outstanding (in shares) | 2,994,928 | 2,994,590 | 2,994,928 | 2,993,154 |
Basic and diluted loss per share (in dollars per share) | $ (0.02) | $ (0.33) | $ (0.42) | $ (0.82) |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Cash flows from operating activities | ||
Net loss | $ (1,124,443) | $ (2,333,427) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 304,451 | 236,135 |
Amortization of debt issuance costs | 6,968 | 0 |
Stock-based compensation | 118,056 | 103,660 |
Changes in operating assets and liabilities | ||
Accounts receivable | (733,939) | (330,878) |
Prepaid expenses and other assets | (67,358) | (51,210) |
Accounts payable and accrued expenses | (549,859) | 339,333 |
Accrued payroll | (192,603) | (41,052) |
Unearned revenue | 18,446 | 83,816 |
Total adjustments | (1,095,838) | 339,804 |
Net cash used in operating activities | (2,220,281) | (1,993,623) |
Cash flows from investing activities | ||
Purchases of property and equipment | (196,194) | (143,793) |
Patent applications and maintenance | (4,905) | (6,024) |
Net cash used in investing activities | (201,099) | (149,817) |
Cash flows from financing activities | ||
Proceeds received from loan payable | 205,000 | 0 |
Repayments of loan payable | (4,640) | 0 |
Cash dividends on series B preferred stock | (126,000) | (84,000) |
Net cash provided by (used in) financing activities | 74,360 | (84,000) |
Net decrease in cash | (2,347,020) | (2,227,440) |
Cash | ||
Beginning of period | 4,046,599 | 7,330,630 |
End of period | 1,699,579 | 5,103,190 |
Supplemental disclosure of cash flow information | ||
Cash payments for interest | 4,332 | 0 |
Non-cash financing activity: | ||
Accrued dividends on series B and C-1 preferred stock | 0 | 42,000 |
Conversion of series A preferred stock into common stock | 0 | 2 |
Purchase of equipment under capital lease obligation | $ 144,775 | $ 0 |
Nature of Business and Basis of
Nature of Business and Basis of Presentation | 9 Months Ended |
Sep. 30, 2015 | |
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 its wholly-owned subsidiary, VirtualScopics New York, LLC (the “Subsidiary” and, together, 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 pursuant to article 10 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, 2014. In the opinion of management, these financial statements contain all adjustments necessary for a fair presentation for and as of the end of the interim period, all of which were normal recurring adjustments. The results of operations for the three and nine months ended September 30, 2015 are not necessarily indicative of the results to be expected for the full year ending December 31, 2015. |
Liquidity and Financial Conditi
Liquidity and Financial Condition | 9 Months Ended |
Sep. 30, 2015 | |
Liquidity and Financial Condition [Abstract] | |
Liquidity and Financial Condition [Text Block] | NOTE 2 Liquidity and Financial Condition The Company had a net loss attributable to common stockholders of $ 1,250,443 18,255,007 2,388,000 2,000,000 The Company’s future plans and growth are dependent on its ability to increase revenues and continue its business development efforts surrounding its contract award backlog. If the Company continues to incur losses and revenues do not generate from the backlog as expected, the Company may need to raise additional capital to expand its business and continue as a going concern. The Company currently anticipates that its cash and cash equivalents will be sufficient to meet its working capital requirements to continue its sales and marketing and research and development efforts for at least 12 months. If in the future our plans or assumptions change or prove to be inaccurate, the Company may need to raise additional funds through public or private debt or equity offerings, financings, corporate collaborations, or other means. The Company may also be required to reduce operating expenditures or investments in its infrastructure. |
Summary of Certain Significant
Summary of Certain Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | NOTE 3 - Summary of Certain Significant Accounting Policies The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and the Subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. Actual results could differ from those estimates. Estimates included in these consolidated financial statements relate to assessing the collectability of accounts receivable, the valuation of securities underlying share-based compensation, realization of deferred tax assets, tax contingencies and any related valuation allowance, and the useful lives and potential impairment of the Company’s property and equipment and intangible assets. Estimates and assumptions are reviewed periodically and the effects of revisions are reflected in the period that they are determined to be necessary. 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 or delivered, as the case may be, 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 at an hourly rate. 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. In its interim financial statements, the Company follows the guidance of Accounting Standards Codification (“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 based upon 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 relates to the development of new applications and processes including improvements and enhancements to existing software applications. These costs are expensed as incurred. In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-03, InterestImputation of Interest-Simplifying the Presentation of Debt Issuance Costs (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2015 | |
Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract] | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | NOTE 4 - Stock-Based Compensation Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Cost of service revenues $ 5,792 $ 10,052 $ 20,726 $ 30,316 Research and development 6,886 7,680 24,066 26,165 Sales and marketing 707 2,290 1,164 7,026 General and administrative 28,422 19,020 72,100 39,595 Total stock-based compensation $ 41,807 $ 39,042 $ 118,056 $ 103,102 Stock options issued under the Company’s long-term incentive plans are granted with an exercise price equal to 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 from the date of grant. As of September 30, 2015, there was $ 384,055 3.06 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. Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Risk free interest rate 1.74 % 1.84 % 1.70 % 1.80 % Expected term (years) 6 5.9 6 5.9 Expected volatility 60.86 % 64.43 % 61.10 % 64.60 % Expected dividend yield - - - - Weighted Weighted Average Average Remaining Number of Exercise Contractual Shares Price Term Options outstanding at January 1, 2015 404,612 $ 10.03 Granted 131,142 2.52 Exercised - Cancelled/Forfeited (25,814) (7.65) Expired (29,693) (13.84) Options outstanding at September 30, 2015 480,247 7.87 6.98 Options exercisable at September 30, 2015 220,239 13.05 4.28 The weighted-average grant-date fair value of options granted during the three months ended September 30, 2015 and 2014 was $ 159,993 393,071 188,917 434,438 |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2015 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity Note Disclosure [Text Block] | NOTE 5 - Stockholders’ Equity As of September 30, 2015, the Company has authorized 1,000,000 0.001 8,400 6,000 3,000 3,000 Each share of Series A is convertible into 83.036 Each share of Series B is convertible into 83.036 1,000 8 96,000 36,000 24,000 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 12.043 1,000 4 239,333 90,000 60,000 |
Loss Per Share
Loss Per Share | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Earnings Per Share [Text Block] | NOTE 6 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. 2015 2014 Convertible preferred stock 478,701 478,701 Warrants to purchase common stock 136,132 136,132 Options to purchase common stock 480,247 401,796 Total 1,095,080 1,016,629 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | NOTE 7 - 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 September 30, 2015 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 September 30, 2015, the Company does not have any interest and penalties accrued related to unrecognized tax benefits. |
Concentration of Credit Risk
Concentration of Credit Risk | 9 Months Ended |
Sep. 30, 2015 | |
Risks and Uncertainties [Abstract] | |
Concentration Risk Disclosure [Text Block] | NOTE 8 - Concentration of Credit Risk Three customers accounted for 23 22 16 28 22 19 10 Three customers accounted for 26%, 22%, and 13% of total revenue for the three months ended September 30, 2015. The Company’s top three customers accounted for approximately 25%, 24%, and 22% of total revenue for the three months ended September 30, 2014. Four customers accounted for approximately 21 19 16 11 27 19 18 |
Related Party
Related Party | 9 Months Ended |
Sep. 30, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | NOTE 9 Related Party In April 2012, the Company issued Merck Global Health Innovation Fund, LLC (“Merck”) 3,000 249,107 136,132 403,098 88,932 179,044 46,177 90,234 95,985 |
Capital Lease Obligation
Capital Lease Obligation | 9 Months Ended |
Sep. 30, 2015 | |
Leases [Abstract] | |
Capital Leases in Financial Statements of Lessee Disclosure [Text Block] | NOTE 10 Capital Lease Obligation On July 29, 2015, the Company entered into a Master Equipment Lease Agreement (the “Lease”) in connection with financing the purchase of $ 144,775 6.23 9,159 1 For the Years Ending December 31, 2015 $ 8,481 2016 33,924 2017 33,924 2018 33,924 2019 33,924 2020 25,444 Total minimum payments 169,621 Less: Amount representing interest (24,846) Present value of net minimum payments $ 144,775 Current portion $ 23,830 Non-current portion 120,945 Total capital lease obligation $ 144,775 |
Financing Arrangements
Financing Arrangements | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Debt Disclosure [Text Block] | NOTE 11 Financing Arrangements On August 7, 2015, the Company entered into a Loan and Security Agreement with a financial institution pursuant to which the Company obtained a revolving line of credit. The maximum amount that the Company may borrow at any time under the line of credit is $ 2,000,000 80 line of credit accrues at the prime rate published by the Wall Street Journal plus 1.00% per annum monthly The line of credit terminates and all amounts outstanding thereunder are due and payable on August 6, 2016. The obligations of the Company under the line of credit are secured by a first priority security interest in all assets of the Company other than intellectual property. The Company did not have any outstanding borrowings under the line of credit as of November 13, 2015. On September 16, 2015, the Company entered into a Transaction Finance Agreement (the “Note”) for $ 205,000 8.33 6,972 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | NOTE 12 - 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 Significan18
Summary of Certain Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and the Subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. Actual results could differ from those estimates. Estimates included in these consolidated financial statements relate to assessing the collectability of accounts receivable, the valuation of securities underlying share-based compensation, realization of deferred tax assets, tax contingencies and any related valuation allowance, and the useful lives and potential impairment of the Company’s property and equipment and intangible assets. Estimates and assumptions are reviewed periodically and the effects of revisions are reflected in the period that they are determined to be necessary. |
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 or delivered, as the case may be, 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 at an hourly rate. 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 Accounting Standards Codification (“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 based upon 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. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-03, InterestImputation of Interest-Simplifying the Presentation of Debt Issuance Costs (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract] | |
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | For the three and nine months ended September 30, 2015 and 2014, the Company’s condensed consolidated statements of operations reflect stock-based compensation expense for stock options granted and restricted stock awards under its long-term incentive plans and allocated as follows: Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Cost of service revenues $ 5,792 $ 10,052 $ 20,726 $ 30,316 Research and development 6,886 7,680 24,066 26,165 Sales and marketing 707 2,290 1,164 7,026 General and administrative 28,422 19,020 72,100 39,595 Total stock-based compensation $ 41,807 $ 39,042 $ 118,056 $ 103,102 |
Schedule of Share-based Compensation, Activity [Table Text Block] | Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Risk free interest rate 1.74 % 1.84 % 1.70 % 1.80 % Expected term (years) 6 5.9 6 5.9 Expected volatility 60.86 % 64.43 % 61.10 % 64.60 % 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 nine months ended September 30, 2015 is as follows: Weighted Weighted Average Average Remaining Number of Exercise Contractual Shares Price Term Options outstanding at January 1, 2015 404,612 $ 10.03 Granted 131,142 2.52 Exercised - Cancelled/Forfeited (25,814) (7.65) Expired (29,693) (13.84) Options outstanding at September 30, 2015 480,247 7.87 6.98 Options exercisable at September 30, 2015 220,239 13.05 4.28 |
Loss Per Share (Tables)
Loss Per Share (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
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 nine months ended September 30, 2015 and 2014: 2015 2014 Convertible preferred stock 478,701 478,701 Warrants to purchase common stock 136,132 136,132 Options to purchase common stock 480,247 401,796 Total 1,095,080 1,016,629 |
Capital Lease Obligation (Table
Capital Lease Obligation (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Leases [Abstract] | |
Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block] | After taking into account the impact of the transaction that occurred on July 29, 2015, minimum payments under the Lease consist of the following: For the Years Ending December 31, 2015 $ 8,481 2016 33,924 2017 33,924 2018 33,924 2019 33,924 2020 25,444 Total minimum payments 169,621 Less: Amount representing interest (24,846) Present value of net minimum payments $ 144,775 Current portion $ 23,830 Non-current portion 120,945 Total capital lease obligation $ 144,775 |
Liquidity and Financial Condi22
Liquidity and Financial Condition (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Aug. 07, 2015 | Dec. 31, 2014 | |
Variable Interest Entity [Line Items] | ||||||
Working Capital | $ 2,388,000 | $ 2,388,000 | ||||
Retained Earnings (Accumulated Deficit) | (18,255,007) | (18,255,007) | $ (17,130,564) | |||
Net Income (Loss) Attributable To Parent | $ (24,779) | $ (955,523) | $ (1,124,443) | $ (2,333,427) | ||
Revolving Credit Facility [Member] | ||||||
Variable Interest Entity [Line Items] | ||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 2,000,000 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation | $ 41,807 | $ 39,042 | $ 118,056 | $ 103,102 |
Cost of service revenues [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation | 5,792 | 10,052 | 20,726 | 30,316 |
Research and development [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation | 6,886 | 7,680 | 24,066 | 26,165 |
Sales and marketing [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation | 707 | 2,290 | 1,164 | 7,026 |
General and administrative [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation | $ 28,422 | $ 19,020 | $ 72,100 | $ 39,595 |
Stock-Based Compensation (Det24
Stock-Based Compensation (Details 1) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Risk free interest rate | 1.74% | 1.84% | 1.70% | 1.80% |
Expected term (years) | 6 years | 5 years 10 months 24 days | 6 years | 5 years 10 months 24 days |
Expected volatility | 60.86% | 64.43% | 61.10% | 64.60% |
Expected dividend yield | 0.00% | 0.00% | 0.00% | 0.00% |
Stock-Based Compensation (Det25
Stock-Based Compensation (Details 2) | 9 Months Ended |
Sep. 30, 2015$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options outstanding - Number of Shares at January 1, 2015 | 404,612 |
Granted - Number of Shares | 131,142 |
Exercised - Number of Shares | 0 |
Cancelled/Forfeited - Number of Shares | (25,814) |
Expired - Number of Shares | (29,693) |
Options outstanding - Number of Shares at September 30, 2015 | 480,247 |
Options exercisable - Number of Shares at September 30, 2015 | 220,239 |
Beginning balance, Options outstanding - Weighted Average Exercise Price | $ / shares | $ 10.03 |
Granted - Weighted Average Exercise Price | $ / shares | 2.52 |
Cancelled/Forfeited - Weighted Average Exercise Price | $ / shares | (7.65) |
Expired - Weighted Average Exercise Price | $ / shares | (13.84) |
Ending balance, Options outstanding - Weighted Average Exercise Price | $ / shares | 7.87 |
Options exercisable - Weighted Average Exercise Price | $ / shares | $ 13.05 |
Options outstanding - Weighted Average Remaining Contractual Term (in years) | 6 years 11 months 23 days |
Options exercisable - Weighted Average Remaining Contractual Term (in years) | 4 years 3 months 11 days |
Stock-Based Compensation (Det26
Stock-Based Compensation (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Total | $ 384,055 | $ 384,055 | ||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 3 years 22 days | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 159,993 | $ 393,071 | $ 188,917 | $ 434,438 |
Maximum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years | |||
Minimum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years |
Stockholders' Equity (Details T
Stockholders' Equity (Details Textual) - USD ($) | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Class of Stock [Line Items] | |||
Convertible preferred stock, shares authorized | 1,000,000 | 1,000,000 | |
Preferred Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | |
Cash dividends on preferred stock | $ 126,000 | $ 84,000 | |
Series A Convertible Preferred Stock [Member] | |||
Class of Stock [Line Items] | |||
Preferred Stock Designated During Period Shares | 8,400 | ||
Stock Conversion Ratio | 83.036 | ||
Series C-1 Convertible Preferred Stock [Member] | |||
Class of Stock [Line Items] | |||
Preferred Stock Designated During Period Shares | 3,000 | ||
Preferred Stock, Liquidation Preference Per Share | $ 1,000 | ||
Preferred Stock Conversion Price Per Share | $ 12.043 | ||
Interest and Dividends Payable, Total | $ 239,333 | $ 239,333 | |
Cash dividends on preferred stock | $ 90,000 | 60,000 | |
Preferred Stock, Dividend Rate, Percentage | 4.00% | ||
Series C-2 Convertible Preferred Stock [Member] | |||
Class of Stock [Line Items] | |||
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] | |||
Class of Stock [Line Items] | |||
Preferred Stock Designated During Period Shares | 6,000 | ||
Preferred Stock, Liquidation Preference Per Share | $ 1,000 | ||
Interest and Dividends Payable, Total | $ 96,000 | $ 96,000 | |
Stock Conversion Ratio | 83.036 | ||
Annual Dividend Rate | 8.00% | ||
Cash dividends on preferred stock | $ 36,000 | $ 24,000 |
Loss Per Share (Details)
Loss Per Share (Details) - shares | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Denominator - diluted: | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 1,095,080 | 1,016,629 |
Convertible preferred stock [Member] | ||
Denominator - diluted: | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 478,701 | 478,701 |
Warrants to purchase common stock [Member] | ||
Denominator - diluted: | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 136,132 | 136,132 |
Options to purchase common stock [Member] | ||
Denominator - diluted: | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 480,247 | 401,796 |
Concentration of Credit Risk (D
Concentration of Credit Risk (Details Textual) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Customer 1 [Member] | |||||
Concentration Risk [Line Items] | |||||
Entity-Wide Accounts Receivable, Major Customer, Percentage | 21.00% | 21.00% | 27.00% | ||
Concentration Risk, Percentage | 26.00% | 25.00% | 23.00% | 28.00% | |
Customer 2 [Member] | |||||
Concentration Risk [Line Items] | |||||
Entity-Wide Accounts Receivable, Major Customer, Percentage | 19.00% | 19.00% | 19.00% | ||
Concentration Risk, Percentage | 22.00% | 24.00% | 22.00% | 22.00% | |
Customer 3 [Member] | |||||
Concentration Risk [Line Items] | |||||
Entity-Wide Accounts Receivable, Major Customer, Percentage | 16.00% | 16.00% | 18.00% | ||
Concentration Risk, Percentage | 13.00% | 22.00% | 16.00% | 19.00% | |
Customer 4 [Member] | |||||
Concentration Risk [Line Items] | |||||
Entity-Wide Accounts Receivable, Major Customer, Percentage | 11.00% | 11.00% | |||
Concentration Risk, Percentage | 10.00% |
Related Party (Details Textual)
Related Party (Details Textual) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Apr. 30, 2012 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Related Party Transaction [Line Items] | ||||||
Revenue from Related Parties | $ 179,044 | $ 46,177 | $ 403,098 | $ 88,932 | ||
Accounts Receivable, Related Parties | $ 90,234 | $ 90,234 | $ 95,985 | |||
Common Stock [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Common stock issuable upon conversion of preferred stock | 249,107 | |||||
Series C-1 Preferred Stock [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Preferred Stock and Warrant Purchase Agreement Shares Issued | 3,000 | |||||
Series C-1 Warrants [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Preferred Stock and Warrant Purchase Agreement, Warrants Issued To Acquire Common Stock Shares, Number | 136,132 |
Capital Lease Obligation (Detai
Capital Lease Obligation (Details) - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
Future Minimum Lease Payments For Capital Leases [Line Items] | ||
2,015 | $ 8,481 | |
2,016 | 33,924 | |
2,017 | 33,924 | |
2,018 | 33,924 | |
2,019 | 33,924 | |
2,020 | 25,444 | |
Total minimum payments | 169,621 | |
Less: Amount representing interest | (24,846) | |
Present value of net minimum payments | 144,775 | |
Current portion | 23,830 | $ 0 |
Non-current portion | 120,945 | $ 0 |
Total capital lease obligation | $ 144,775 |
Capital Lease Obligation (Det32
Capital Lease Obligation (Details Textual) | 1 Months Ended |
Jul. 29, 2015USD ($) | |
Debt Instrument, Face Amount | $ 144,775 |
Debt Instrument, Periodic Payment | 9,159 |
Option To Purchase Lease Equipment At Maturity | $ 1 |
Debt Instrument, Interest Rate, Stated Percentage | 6.23% |
Financing Arrangements (Details
Financing Arrangements (Details Textual) - USD ($) | Aug. 07, 2015 | Jul. 29, 2015 | Sep. 30, 2015 |
Debt Instrument, Face Amount | $ 144,775 | ||
Debt Instrument, Interest Rate, Stated Percentage | 6.23% | ||
Percentage Of Accounts Receivable | 80.00% | ||
Debt Instrument, Periodic Payment | $ 9,159 | ||
Prime Rate [Member] | |||
Line of Credit Facility, Interest Rate Description | line of credit accrues at the prime rate published by the Wall Street Journal plus 1.00% per annum | ||
Debt Instrument, Frequency of Periodic Payment | monthly | ||
Revolving Credit Facility [Member] | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 2,000,000 | ||
Transaction Finance Agreement [Member] | |||
Debt Instrument, Face Amount | $ 205,000 | ||
Debt Instrument, Interest Rate, Stated Percentage | 8.33% | ||
Debt Instrument, Periodic Payment | $ 6,972 |