Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Jul. 31, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | OptimizeRx Corp | |
Entity Central Index Key | 1,448,431 | |
Trading Symbol | OPRX | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 11,637,546 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Current Assets | ||
Cash and cash equivalents | $ 12,003,864 | $ 5,122,573 |
Accounts receivable | 2,954,782 | 2,257,276 |
Accounts receivable - related party | 2,555,931 | 1,173,614 |
Prepaid expenses | 215,108 | 255,428 |
Total Current Assets | 17,729,685 | 8,808,891 |
Property and equipment, net | 152,898 | 167,305 |
Other Assets | ||
Patent rights, net | 604,820 | 638,766 |
Web development and other intangible costs, net | 152,381 | 143,730 |
Security deposit | 5,049 | 5,049 |
Total Other Assets | 762,250 | 787,545 |
TOTAL ASSETS | 18,644,833 | 9,763,741 |
Current Liabilities | ||
Accounts payable - trade | 176,940 | 457,289 |
Accrued expenses | 828,540 | 953,947 |
Revenue share payable | 994,142 | 1,177,136 |
Revenue share payable - related party | 447,670 | |
Deferred revenue | 845,153 | 507,160 |
Total Liabilities | 2,844,775 | 3,543,202 |
Stockholders' Equity | ||
Preferred stock, $0.001 par value, 10,000,000 shares authorized, no issued and outstanding at June 30, 2018 or December 31, 2017 | ||
Common stock, $0.001 par value, 166,666,667 shares authorized, 11,556,858 and 9,772,694 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively | 11,557 | 9,773 |
Stock warrants | 1,286,424 | 1,286,424 |
Additional paid-in-capital | 44,915,896 | 35,287,464 |
Accumulated deficit | (30,413,819) | (30,363,122) |
Total Stockholders' Equity | 15,800,058 | 6,220,539 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 18,644,833 | $ 9,763,741 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 166,666,667 | 166,666,667 |
Common stock, shares issued | 11,556,858 | 9,772,694 |
Common stock, shares outstanding | 11,556,858 | 9,772,694 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
NET REVENUE | ||||
Revenue | $ 3,192,138 | $ 2,252,222 | $ 5,961,257 | $ 3,652,540 |
Revenue - Related Party | 1,907,336 | 613,601 | 3,250,453 | 1,365,356 |
TOTAL NET REVENUE | 5,099,474 | 2,865,823 | 9,211,710 | 5,017,896 |
REVENUE SHARE EXPENSE | 2,236,751 | 1,605,534 | 4,244,842 | 2,987,267 |
GROSS MARGIN | 2,862,723 | 1,260,289 | 4,966,868 | 2,030,629 |
OPERATING EXPENSES | 2,589,126 | 1,630,853 | 4,884,467 | 3,291,631 |
INCOME (LOSS) FROM OPERATIONS | 273,597 | (370,564) | 82,401 | (1,261,002) |
OTHER INCOME (EXPENSE) | ||||
Interest income | 6,912 | 9,063 | 8,929 | 16,819 |
Interest expense | ||||
TOTAL OTHER INCOME (EXPENSE) | 6,912 | 9,063 | 8,929 | 16,819 |
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES | 280,509 | (361,501) | 91,330 | (1,244,183) |
PROVISION FOR INCOME TAXES | ||||
NET INCOME (LOSS) | $ 280,509 | $ (361,501) | $ 91,330 | $ (1,244,183) |
WEIGHTED AVERGE NUMBER OF SHARES OUTSTANDING | ||||
BASIC | 10,979,086 | 9,861,257 | 10,373,326 | 9,883,648 |
DILUTED | 11,949,593 | 9,861,257 | 11,517,604 | 9,883,648 |
NET INCOME (LOSS) PER SHARE | ||||
BASIC | $ 0.03 | $ (0.04) | $ 0.01 | $ (0.13) |
DILUTED | $ 0.02 | $ (0.04) | $ 0.01 | $ (0.13) |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income (loss) for the period | $ 91,330 | $ (1,244,183) |
Adjustments to reconcile net income(loss) to net cash used in operating activities: | ||
Depreciation and amortization | 108,946 | 141,945 |
Stock and options issued for services | 1,013,822 | 291,874 |
Changes in: | ||
Accounts receivable | (2,079,823) | 638,602 |
Prepaid expenses | 40,320 | (866,333) |
Accounts payable | (280,349) | 534,743 |
Revenue share payable | (183,664) | (751,094) |
Accrued expenses | (125,407) | (91,981) |
Deferred revenue | 195,966 | 650,331 |
NET CASH USED IN OPERATING ACTIVITIES | (1,218,859) | (696,096) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of property and equipment | (12,593) | (24,599) |
Web development and other intangible costs | (56,651) | (81,350) |
NET CASH USED IN INVESTING ACTIVITIES | (69,244) | (105,949) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net proceeds from issuance of common stock for cash | 8,169,394 | |
Repurchase of common stock and stock payable | (390,000) | |
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | 8,169,394 | (390,000) |
NET CHANGEIN CASH AND CASH EQUIVALENTS | 6,881,291 | (1,192,045) |
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 5,122,573 | 7,034,647 |
CASH AND CASH EQUIVALENTS - END OF PERIOD | 12,003,864 | 5,842,602 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||
Cash paid for interest | ||
Cash paid for income taxes | ||
Non-cash issuance of shares to WPP | $ 447,000 |
Nature of Business and Basis of
Nature of Business and Basis of Presentation | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF BUSINESS AND BASIS OF PRESENTATION | NOTE 1 – NATURE OF BUSINESS AND BASIS OF PRESENTATION We are a leading provider of digital health messaging via electronic health records (EHRs), providing a direct channel for pharmaceutical companies to communicate with healthcare providers. Our cloud-based solution supports patient adherence to medications by providing real-time access to financial assistance, prior authorization, education and critical clinical information. Our network is comprised of leading EHR platforms and provides more than half the ambulatory healthcare providers access to these benefits within their workflow at the point of care. The consolidated financial statements for the three and six months ended June 30, 2018 and 2017, have been prepared by us without audit pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). In the opinion of management, all adjustments necessary to present fairly our financial position, results of operations, and cash flows as of June 30, 2018 and 2017, and for the periods then ended, have been made. Those adjustments consist of normal and recurring adjustments. The consolidated balance sheet as of December 31, 2017, has been derived from the audited consolidated balance sheet as of that date. Certain information and note disclosures normally included in our annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. These consolidated financial statements should be read in conjunction with a reading of the financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, as filed with the SEC. The results of operations for the three and six months ended June 30, 2018, are not necessarily indicative of the results to be expected for the full year. Certain reclassifications have been made in our consolidated financial statements for the prior periods to conform to the presentation of our consolidated financial statements for the current periods. |
New Financial Accounting Standa
New Financial Accounting Standards | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
NEW FINANCIAL ACCOUNTING STANDARDS | NOTE 2 – NEW FINANCIAL ACCOUNTING STANDARDS On January 1, 2018, we adopted the new accounting standard ASC 606, Revenue from Contracts with Customers We have applied the new revenue standard to all contracts as of the date of initial application. The overwhelming majority of our revenue continues to be recognized when transactions occur, such as the delivery of a message. We previously recognized revenue related to set-ups when a program launched, and all related activities had been accomplished. Under the new revenue standard, we are recognizing revenue related to these set ups over the term of the initial contract. Since set up fees are generally small relative to the size of the overall contract and because most contracts are for a year or less, the impact of this change is immaterial. The impact of recording this change as of January 1, 2018 resulted in an increase in deferred revenue of $142,027 at that date and a corresponding decrease in retained earnings as well. The impact of adopting the new revenue standard in 2018 resulted in lower revenues in the six months ended June 30, 2018. Had the new revenue standard not taken effect, our revenues for the period would have been higher by $144,262 and deferred revenues lower by $144,262. Almost all of these revenues are expected to be recognized by December 31, 2018, so the primary effect of the new revenue standard is to shift revenues between quarters by immaterial amounts. The impact of adopting the new revenue standard in 2018 also resulted in lower revenues in the three months ended June 30, 2018. Had the new revenue standard not taken effect, our revenues for the period would have been higher by $26,351. |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2018 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | NOTE 3 – STOCKHOLDERS’ EQUITY Effective May 14, 2018, in connection with our listing on the Nasdaq Capital Markets Exchange, we implemented a reverse split of our common stock by exchanging each three shares of our common stock for one share. The effect of this reverse split is presented in the accompanying financial statements as if it had been effective as off the beginning of the earliest period presented. We elected to round fractional shares up to the nearest whole number rather than redeem them for cash, and as a result we issued 908 additional shares. Our Director Compensation Plan calls for issuance of 2,084 shares per quarter to each independent director. In 2018, we issued 6,252 shares valued at $28,875 and 8,336 shares valued at $89,945 for the quarters ended March 31, and June 30, respectively. In 2017, we issued 6,252 shares in each of the quarters ended March 31, 2017 and June 30, 2017, valued at $15,375 and $19,312, respectively. In the quarter ended March 31, 2018, we issued 100,000 shares of common stock to a subsidiary of WPP, one of the world’s largest media companies, and a shareholder, in full payment of all amounts due under a comarketing agreement that covered certain WPP agencies, whereby we shared a portion of our revenue with those agencies related to programs awarded to us by those agencies. The shares were valued at $447,000, the market value of the stock on the date of issuance. The amount due was recorded as a liability in revenue share payable at December 31, 2017. During the quarter ended June 30, 2018, in a private transaction, we issued 1,666,669 shares of our common stock for gross proceeds of $9,000,000. In connection with this transaction, we incurred equity issuance costs of $835,526 related to payments to advisors and legal fees associated with the transaction, resulting in net proceeds to the Company of $8,164,474. We also issued 2,002 common shares and received proceeds of $4,920 in connection with the exercise of options by a former employee during the quarter ended June 30, 2018. |
Share Based Payments - Options
Share Based Payments - Options and Stock Awards | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
SHARE BASED PAYMENTS - OPTIONS AND STOCK AWARDS | NOTE 4 – SHARE BASED PAYMENTS – OPTIONS AND STOCK AWARDS We use the fair value method to account for stock-based compensation. We recorded $712,998 and $257,187 in compensation expense in the six months ended June 30, 2018 and 2017, respectively, related to options issued under our stock-based incentive compensation plan. This includes expense related to options issued in prior years for which the requisite service period for those options includes the current year, options granted in the current year and options repriced in the current year. The assumptions used in this model were similar to the assumptions set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017 related to grants in 2017. As also discussed in the 10-K, we increased the shares of common stock authorized under our stock option plan during the quarter to 1,833,333 million shares. We also granted 130,000 shares of performance based stock awards during the six months ended June 30, 2018. These shares were valued at their fair market value of $4.20 per share on the date of grant. The grants are currently expected to vest. A total of $182,004 of expense has been recorded related to these grants. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 5 – COMMITMENTS AND CONTINGENCIES Litigation The company is not involved in any legal proceedings. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2018 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 6 – RELATED PARTY TRANSACTIONS WPP, a large international media conglomerate, owns approximately 18% of our common shares. As described in more detail in Note 3, Stockholders Equity, we issued 100,000 shares of our common stock to a subsidiary of WPP related to the finalization and termination of a co-marketing agreement. Our customers are primarily pharmaceutical companies; however, sometimes their messaging programs are billed through media agencies. Revenues earned on messaging programs billed through media agencies owned by WPP are reflected as related party revenues on our income statement. Amounts due from those same agencies are reflected as related party accounts receivable on the balance sheet since their parent company owns a minority portion of our common shares. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 6 Months Ended |
Jun. 30, 2018 | |
Net Income Loss Per Share | |
NET INCOME (LOSS) PER SHARE | NOTE 7 – NET INCOME (LOSS) PER SHARE The following tables sets forth the computation of basic and diluted net income per share. Three months ended Six Months ended 2018 2017 2018 2017 Numerator Net income loss $ 280,509 $ (361,501 ) $ 91,330 $ (1,244,183 ) Denominator Weighted average shares outstanding used in computing net income (loss) per share Basic 10,979,086 9,861,257 10,373,326 9,883,648 Effect of dilutive stock options, warrants, and stock grants 970,507 - 1,144,278 - Diluted 11,949,593 9,861,257 11,517,604 9,883,648 Net Income (Loss) per share Basic $ 0.03 $ (0.04 ) $ 0.01 $ (0.13 ) Diluted $ 0.02 $ (0.04 ) $ 0.01 $ (0.13 ) |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2018 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 8 – SUBSEQUENT EVENTS In July 2018, we issued 34,656 shares of common stock and received proceeds of $104,581 in connection with the exercise of options by former consultants and a former employee. In addition, in July 2018, we issued 46,032 shares of our common stock in connection with the cashless exercise of 70,842 warrants that were issued in March 2014 and would have otherwise expired in March 2019. |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Net Income Loss Per Share | |
Schedule of basic and diluted net income per share | Three months ended Six Months ended 2018 2017 2018 2017 Numerator Net income loss $ 280,509 $ (361,501 ) $ 91,330 $ (1,244,183 ) Denominator Weighted average shares outstanding used in computing net income (loss) per share Basic 10,979,086 9,861,257 10,373,326 9,883,648 Effect of dilutive stock options, warrants, and stock grants 970,507 - 1,144,278 - Diluted 11,949,593 9,861,257 11,517,604 9,883,648 Net Income (Loss) per share Basic $ 0.03 $ (0.04 ) $ 0.01 $ (0.13 ) Diluted $ 0.02 $ (0.04 ) $ 0.01 $ (0.13 ) |
New Financial Accounting Stan15
New Financial Accounting Standards (Details) - USD ($) | Jan. 02, 2018 | Jun. 30, 2018 |
New Financial Accounting Standards (Textual) | ||
Increase in deferred revenue | $ 142,027 | |
New revenue accounting standard, description | The new revenue standard not taken effect, our revenues for the period would have been higher by $144,262 and deferred revenues lower by $144,262. Almost all of these revenues are expected to be recognized by December 31, 2018, so the primary effect of the new revenue standard is to shift revenues between quarters by immaterial amounts. The impact of adopting the new revenue standard in 2018 also resulted in lower revenues in the three months ended June 30, 2018. Had the new revenue standard not taken effect, our revenues for the period would have been higher by $26,351. |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) | May 14, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2017 | Mar. 31, 2017 | Jun. 30, 2018 | Jun. 30, 2018 |
Stockholders' Equity (Textual) | |||||||
Reserve stock split, description | We implemented a reverse split of our common stock by exchanging each three shares of our common stock for one share. | ||||||
Shares issued | 908 | ||||||
Shares of common stock issued | 100,000 | ||||||
Shares of common stock issued, value | $ 447,000 | ||||||
Payments to advisors and legal fees | $ 835,526 | ||||||
Net proceeds issuance of common stock | $ 8,164,474 | ||||||
Issuance of common stock exercise | 2,002 | ||||||
Issuance of common stock exercise value | $ 4,920 | ||||||
Private Placement [Member] | |||||||
Stockholders' Equity (Textual) | |||||||
Shares of common stock issued | 1,666,669 | ||||||
Gross proceeds of common stock amount | $ 9,000,000 | ||||||
Director [Member] | |||||||
Stockholders' Equity (Textual) | |||||||
Compensation plan issuance of shares | 2,084 | ||||||
Shares of common stock issued | 8,336 | 6,252 | 6,252 | 6,252 | |||
Shares of common stock issued, value | $ 89,945 | $ 28,875 | $ 19,312 | $ 15,375 |
Share Based Payments - Option17
Share Based Payments - Options and Stock Awards (Details) - Stock Option [Member] - USD ($) | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Share Based Payments - Options and Stock Awards (Textual) | ||
Compensation expense | $ 712,998 | $ 257,187 |
Increased the shares of common stock authorized | 1,833,333 | |
Share based compensation arrangement by share-based payment award, granted | 130,000 | |
Fair market value price per share | $ 4.20 | |
Share based compensation arrangement by shares-based payment award, granted value | $ 182,004 |
Related Party Transactions (Det
Related Party Transactions (Details) - shares | 3 Months Ended | |
Mar. 31, 2018 | Jun. 30, 2018 | |
Related Party Transactions (Textual) | ||
Shares of common stock issued | 100,000 | |
Percentage of common shares owned by shareholder | 18.00% |
Net Income (Loss) Per Share (De
Net Income (Loss) Per Share (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Numerator | ||||
Net income loss | $ 280,509 | $ (361,501) | $ 91,330 | $ (1,244,183) |
Weighted average shares outstanding used in computing net income (loss) per share | ||||
Basic | 10,979,086 | 9,861,257 | 10,373,326 | 9,883,648 |
Effect of dilutive stock options, warrants, and stock grants | 970,507 | 1,144,278 | ||
Diluted | 11,949,593 | 9,861,257 | 11,517,604 | 9,883,648 |
Net Income (Loss) per share | ||||
Basic | $ 0.03 | $ (0.04) | $ 0.01 | $ (0.13) |
Diluted | $ 0.02 | $ (0.04) | $ 0.01 | $ (0.13) |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Events [Member] | 1 Months Ended |
Jul. 31, 2018USD ($)shares | |
Subsequent Events (Textual) | |
Shares of common stock issued | 34,656 |
Issuance of common stock exercise value | $ | $ 104,581 |
Additional Issuance of common stock | 46,032 |
Number of Warrants exercise | 70,842 |
Warrants expired date | Mar. 31, 2019 |