Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 24, 2020 | Jun. 30, 2019 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | OptimizeRx Corp | ||
Entity Central Index Key | 0001448431 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2019 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Shell Company | false | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Interactive Data Current | Yes | ||
Entity Incorporation State Country Code | NV | ||
Entity File Number | 001-38543 | ||
Entity Public Float | $ 221,759,775 | ||
Entity Common Stock, Shares Outstanding | 14,635,611 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Current Assets | ||
Cash and cash equivalents | $ 18,852,680 | $ 8,914,034 |
Accounts receivable, net | 7,418,025 | 6,457,841 |
Prepaid expenses | 871,043 | 360,146 |
Total Current Assets | 27,141,748 | 15,732,021 |
Property and equipment, net | 176,014 | 149,330 |
Other Assets | ||
Goodwill | 14,740,031 | 3,678,513 |
Technology assets, net | 6,238,453 | 104,820 |
Patent rights, net | 2,550,587 | 2,766,944 |
Right of use assets, net | 559,863 | |
Other intangible assets, net | 5,151,102 | 2,387,303 |
Security deposits and other assets | 80,727 | 235,647 |
Total Other Assets | 29,320,763 | 9,173,227 |
TOTAL ASSETS | 56,638,525 | 25,054,578 |
Current Liabilities | ||
Accounts payable - trade | 492,995 | 411,010 |
Accrued expenses | 1,800,635 | 1,300,882 |
Revenue share payable | 1,618,438 | 1,908,616 |
Current portion of lease liabilities | 115,431 | |
Contingent purchase price payable | 1,500,000 | |
Deferred revenue | 580,014 | 610,625 |
Total Current Liabilities | 6,107,513 | 4,231,133 |
Non-current Liabilities | ||
Lease liabilities, net of current portion | 448,753 | |
Contingent purchase price payable, net of current portion | 5,220,000 | 2,365,000 |
Total Non-Current Liabilities | 5,668,753 | 2,365,000 |
Total Liabilities | 11,776,266 | 6,596,133 |
Commitments and contingencies (See Note 15) | ||
Stockholders' Equity | ||
Preferred stock, $0.001 par value, 10,000,000 shares authorized, none issued and outstanding at December 31, 2019 and 2018, | ||
Common stock, $0.001 par value, 166,666,667 shares authorized, 14,600,579 and 12,038,618 shares issued and outstanding at December 31, 2019 and 2018, respectively | 14,601 | 12,039 |
Additional paid-in-capital | 78,272,268 | 48,725,211 |
Accumulated deficit | (33,424,610) | (30,278,805) |
Total Stockholders' Equity | 44,862,259 | 18,458,445 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 56,638,525 | $ 25,054,578 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
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 | 14,600,579 | 12,038,618 |
Common stock, shares outstanding | 14,600,579 | 12,038,618 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
NET REVENUE | ||
Revenue | $ 24,598,274 | $ 21,206,363 |
Cost of revenues | 9,158,699 | 8,999,666 |
Gross margin | 15,439,575 | 12,206,697 |
Operating expenses | ||
Stock-based compensation | 2,260,298 | 2,520,852 |
Depreciation and amortization | 1,282,787 | 316,502 |
Other general and administrative expenses | 15,590,054 | 9,189,211 |
Total operating expenses | 19,133,139 | 12,026,565 |
(Loss) income from operations | (3,693,564) | 180,132 |
Other income (expense) | ||
Interest income | 288,028 | 46,212 |
Change in fair value of contingent consideration | (635,000) | |
Total other (expense) income | (346,972) | 46,212 |
Income (loss) before provision for income taxes | (4,040,536) | 226,344 |
Income tax benefit | 897,960 | |
Net (loss) income | $ (3,142,576) | $ 226,344 |
Weighted average number of shares outstanding – basic | 13,387,863 | 10,832,209 |
Weighted average number of shares outstanding – diluted | 13,387,863 | 11,862,991 |
(Loss) income per share – basic | $ (0.23) | $ 0.02 |
(Loss) income per share – diluted | $ (0.23) | $ 0.02 |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Equity - USD ($) | Common Stock | Stock Warrants | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at Dec. 31, 2017 | $ 9,773 | $ 1,286,424 | $ 35,287,464 | $ (30,363,122) | $ 6,220,539 |
Balance, shares at Dec. 31, 2017 | 9,772,694 | ||||
Cumulative effect of change in accounting principle related to revenue recognition | (142,027) | (142,027) | |||
Stock-based Compensation Expense | 1,863,911 | 1,863,911 | |||
Issuance of common stock for services | $ 51 | 656,883 | 656,934 | ||
Issuance of common stock for services, shares | 51,494 | ||||
Issuance of common stock for cash | $ 1,667 | 8,162,807 | 8,164,474 | ||
Issuance of common stock for cash, shares | 1,666,669 | ||||
Issuance of common stock for options exercised | $ 165 | 521,105 | 521,270 | ||
Issuance of common stock for options exercised, shares | 165,169 | ||||
Issuance of common stock for warrants exercised | $ 251 | (1,286,424) | 1,286,173 | ||
Issuance of common stock for warrants exercised, shares | 251,046 | ||||
Shares issued for acquisition | $ 31 | 499,969 | 500,000 | ||
Shares issued for acquisition, shares | 30,638 | ||||
Shares issued in payment of revenue share | $ 100 | 446,900 | 447,000 | ||
Shares issued in payment of revenue share, shares | 100,000 | ||||
Additional shares issued in connection with reverse split due to rounding | $ 1 | (1) | |||
Additional shares issued in connection with reverse split due to rounding, shares | 908 | ||||
Net income loss for the year | 226,344 | 226,344 | |||
Balance at Dec. 31, 2018 | $ 12,039 | 48,725,211 | (30,278,805) | 18,458,445 | |
Balance, shares at Dec. 31, 2018 | 12,038,618 | ||||
Cumulative effect of change in accounting principle related to lease accounting | (3,229) | (3,229) | |||
Shares issued in 2019 for restricted stock awards granted and expensed in 2018 | $ 130 | (130) | |||
Shares issued in 2019 for restricted stock awards granted and expensed in 2018, shares | 130,001 | ||||
Stock-based Compensation Expense Options | 1,687,745 | 1,687,745 | |||
Stock-based Compensation Expense Restricted Stock | 125,160 | 125,160 | |||
Issuance of common stock for services | $ 33 | 447,360 | 447,393 | ||
Issuance of common stock for services, shares | 33,344 | ||||
Issuance of common stock for cash | $ 1,769 | 21,302,057 | 21,303,826 | ||
Issuance of common stock for cash, shares | 1,769,275 | ||||
Issuance of common stock for options exercised | $ 247 | 877,455 | 877,702 | ||
Issuance of common stock for options exercised, shares | 246,448 | ||||
Shares issued for acquisition | $ 383 | 5,107,410 | 5,107,793 | ||
Shares issued for acquisition, shares | 382,893 | ||||
Net income loss for the year | (3,142,576) | (3,142,576) | |||
Balance at Dec. 31, 2019 | $ 14,601 | $ 78,272,268 | $ (33,424,610) | $ 44,862,259 | |
Balance, shares at Dec. 31, 2019 | 14,600,579 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net (loss) income for the period | $ (3,142,576) | $ 226,344 |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Depreciation and amortization | 1,282,787 | 316,502 |
Noncash lease expense | 107,656 | |
Increase in bad debt reserve | 80,000 | |
Loss on disposal of assets | 2,401 | |
Stock-based compensation | 2,260,298 | 2,520,845 |
Income tax benefit | (897,960) | |
Change in fair value of contingent consideration | 635,000 | |
Changes in: | ||
Accounts receivable | (628,830) | (2,789,252) |
Prepaid expenses and other assets | (343,838) | (319,754) |
Accounts payable | (46,249) | (83,319) |
Revenue share payable | (290,178) | 730,810 |
Accrued expenses and other | (432,075) | 226,535 |
Change in operating lease liabilities | (106,564) | |
Deferred revenue | (30,611) | (38,557) |
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES | (1,660,796) | 792,555 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchases of property and equipment | (87,717) | (34,362) |
Acquisition of intangible assets | (1,500,000) | (56,651) |
Cash paid in acquisition, net of cash acquired | (8,994,369) | (5,595,820) |
NET CASH USED IN INVESTING ACTIVITIES | (10,582,086) | (5,686,833) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from issuance of common stock, net of offering costs | 21,303,826 | 8,164,475 |
Proceeds from exercise of stock options | 877,702 | 521,264 |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 22,181,528 | 8,685,739 |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 9,938,646 | 3,791,461 |
CASH AND CASH EQUIVALENTS – BEGINNING OF PERIOD | 8,914,034 | 5,122,573 |
CASH AND CASH EQUIVALENTS – END OF PERIOD | 18,852,680 | 8,914,034 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||
Cash paid for interest | ||
Cash paid for income taxes | ||
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Exercise of stock warrants | 1,286,424 | |
Issuance of shares for restricted stock awards in 2019 for awards expensed in 2018 | 130 | |
Lease liabilities arising from right of use assets | 207,559 | |
Common stock issued for debt | 447,000 | |
Shares issued in connection with acquisitions | 5,107,793 | 500,000 |
Non-cash effect of cumulative adjustments to accumulated deficit | $ 3,229 | $ 142,027 |
Organization and Nature of Busi
Organization and Nature of Business | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND NATURE OF BUSINESS | NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS OptimizeRx Corporation is a digital health company focused on connecting life sciences companies to their clients with critical content at the point-of-care. It provides electronic clinical information via electronic health record companies (EHRs) to the medical profession, providing a direct channel for pharmaceutical companies to communicate with healthcare providers. The Company's cloud-based solution supports patient adherence to medications by providing real-time access to financial assistance, prior authorization, and critical clinical information. The Company's network is comprised of leading EHR platforms and provides more than half of the ambulatory patient market with access to these benefits within their workflow at the point-of-care. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Estimates and assumptions have been made in determining the carrying value of assets, depreciable and amortizable lives of tangible and intangible assets, the carrying value of liabilities, the valuation allowance for the deferred tax asset, the timing of revenue recognition and related revenue share expenses, and inputs used in the calculation of stock based compensation. Actual results could differ from these estimates. Principles of Consolidation The financial statements reflect the consolidated results of OptimizeRx Corporation, a Nevada corporation, and its wholly owned subsidiaries: OptimizeRx Corporation, a Michigan corporation, RMDY Health, Inc., a Delaware corporation, CareSpeak Communications, Inc., a New Jersey corporation, Cyberdiet, a controlled foreign corporation incorporated in Israel, and CareSpeak Communications D.O.O., a Controlled Foreign Corporation incorporated in Croatia. Together, these companies are referred to as "OptimizeRx" and "the Company." All material intercompany transactions have been eliminated. Reclassifications Certain items in the previous year financial statements have been reclassified to match the current year presentation. Cash and Cash Equivalents For purposes of the accompanying financial statements, the Company considers all highly liquid instruments, consisting of money market accounts, with an initial maturity of three months or less to be cash equivalents. Fair Value of Financial Instruments Fair value is defined as 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 and in the principal or most advantageous market for that asset or liability. The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk including our own credit risk. In addition to defining fair value, the disclosure requirements around fair value establish a fair value hierarchy for valuation inputs, which is expanded. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels, which is determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are: Level 1 – Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets. Level 2 – Inputs are based upon significant observable inputs other than quoted prices included in Level 1, such as quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Inputs are generally unobservable and typically reflect management's estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques. The Company's stock options and warrants are valued using level 3 inputs. The following tables present the fair values and carrying values of the Company's financial assets and liabilities measured on a recurring basis as of December 31, 2019 and 2018 and the valuation techniques used by the Company to determine those fair values. 2019 Level 1 Level 2 Level 3 Fair Value Carrying Value Liabilities Contingent Purchase Price Payable (1) $ - $ - $ 6,720,000 $ 6,720,000 $ 6,720,000 2018 Level 1 Level 2 Level 3 Fair Value Carrying Value Liabilities Contingent Purchase Price Payable (1) $ - $ - $ 2,365,000 $ 2,365,000 $ 2,365,000 (1) The contingent consideration is based off achieving certain revenue milestones in each of the next two years. The Geometric-Brownian motion analysis was used to generate spot prices for use in an option pricing model. For 2018, the hypothetical spot prices were simulated using a monte carlo simulation utilizing 2018 revenue as a base and revenue volatility of 37%. The risk-free rate of return and terms utilized were 2.89% and 1.46-2.46, respectively, and expected volatility was 35%. For 2019, the hypothetical spot prices were simulated using a monte carlo simulation utilizing 2020 and 2021 revenue projections and revenue volatility of 40%. The risk-free rate of return and terms utilized were 1.40% and 1 -2 years, respectively, and expected volatility was 40%. The following table provides a summary of changes in fair value of the Company's Level 3 financial instruments for the years ended December 31, 2019 and 2018. Amount Balance December 31, 2017 $ - Contingent consideration liability recorded as the result of the CareSpeak Communications acquisition (see note 3) 2,365,000 Balance December 31, 2018 2,365,000 Increase in fair value of CareSpeak Communications contingent consideration 635,000 Contingent consideration liability recorded as the result of the RMDY Health, Inc. acquisition (see note 3) 3,720,000 Balance December 31, 2019 $ 6,720,000 Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are reported at realizable value, net of allowances for doubtful accounts, which is estimated and recorded in the period the related revenue is recorded. The Company has a standardized approach to estimate and review the collectability of its receivables based on a number of factors, including the period they have been outstanding. Historical collection and payer reimbursement experience is an integral part of the estimation process related to allowances for doubtful accounts. In addition, the Company regularly assesses the state of its billing operations in order to identify issues, which may impact the collectability of these receivables or reserve estimates. Because the Company's customers are primarily large well-capitalized companies, historically there has been very little bad debt expense. Bad debt expense was $80,000 for the year ended December 31, 2019 and $0 for the year ended December 31, 2018. The allowance for doubtful accounts was $80,000 and $0 as of December 31, 2019 and 2018, respectively. Property and Equipment Property and equipment are stated at cost and are being depreciated over their estimated useful lives of three to five years for office equipment and three years for computer equipment using the straight-line method of depreciation for book purposes. Maintenance and repair charges are expensed as incurred. Intangible Assets Intangible assets are stated at cost. Finite-lived assets are being amortized over their estimated useful lives of fifteen to seventeen years for patents, eight years for customer relationships, fifteen years for tradenames, four years for covenants not to compete, and three to four years for software and websites, all using the straight-line method. These assets, as well as our indefinite-lived asset, are evaluated annually in our fiscal fourth quarter for impairment. Goodwill We evaluate goodwill for impairment during our fiscal fourth quarter, or more frequently if an event occurs or circumstances change. Revenue Recognition Recognition of revenue requires evidence of a contract, probable collection of proceeds, and completion of substantially all performance obligations. We use a 5-step model to recognize revenue. These steps are: identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when or as the performance obligations are satisfied. Revenues are primarily generated from content delivery activities in which the Company delivers financial, clinical, or brand messaging through a distribution network of eprescribers and electronic health record technology providers (channel partners), directly to consumers, or from reselling services that complement the business. Unless otherwise specified, revenue is recognized based on the gross selling price to customers. The Company's contracts are generally all less than one year and the primary performance obligation is delivery of messages, but the contract may contain additional performance obligations. Additional performance obligations may include program design and set up, and reporting. As the messaging is distributed through the platform and network of channel partners (a transaction), these transactions are recorded, and revenue is recognized, at the time of distribution. Revenue for transactions can be realized based on a price per message, a price per redemption, as a flat fee occurring over a period of time, or upon completion of the program, depending on the client contract. The Company recognizes setup fees that are required for integrating client offerings and campaigns into the rule-based content delivery system and network over the life of the initial program, based either on time, or units delivered, depending upon which is most appropriate in the specific situation. Should a program be cancelled before completion, the balance of set up revenue is recognized at the time of cancellation, as set up fees are nonrefundable. Additionally, the Company also recognizes revenue for providing program performance reporting and maintenance, either by the Company directly delivering reports or by providing access to its online reporting portal that the client can utilize. These fees are charged monthly and recognized as recurring monthly revenue at the time of delivery. In some instances, the Company also resells products and or services that are available through channel partners on a commission basis, and that are complementary to the core business and client base. In these instances, net revenue is recognized based on the commission-based revenue split that the Company receives. In instances where the Company resells services and have all financial risk and significant operation input and risk, the Company records the revenue gross. Cost of Revenues The primary cost of revenue is revenue share expense. Based on the volume of transactions that are delivered through the channel partner network, the Company provides a revenue share to compensate the partner, or others, for their promotion of the campaign. Revenue shares are a negotiated percentage of the transaction fees and can also be specific to special considerations and campaigns. Income Taxes Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax basis of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized. The Company recognizes the tax benefit from uncertain tax positions if it is more likely than not that the tax positions will be sustained on examination by the tax authorities, based on the technical merits of the position. The tax benefit is measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. It is the Company's policy to include interest and penalties related to tax positions as a component of income tax expense. Concentration of Credit Risks The Company maintains its cash and cash equivalents in bank deposit accounts, which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts; however, amounts in excess of the federally insured limit may be at risk if the bank experiences financial difficulties. As of December 31, 2019 and 2018 the Company had $18,047,903 and $8,414,034, respectively, in cash balances in excess of federally insured limits, primarily at Bank of America/Merrill Lynch. Research and Development The Company expenses research and development expenses as incurred. Research and development expense was $1,604,195 and $0 in 2019 and 2018, respectively. Stock-based Compensation The Company uses the fair value method to account for stock-based compensation. The fair value of the equity instrument is charged directly to compensation expense and additional paid-in capital over the period during which services are rendered. The fair value of each award is estimated on the date of each grant. For restricted stock, the fair market value is based on the market value of the stock granted on the date of the grant. For options, it is estimated using the Black-Scholes option pricing model that uses the assumptions noted in the following table. Estimated volatilities are based on the historical volatility of the Company's stock over the same period as the expected term of the options. The expected term of options granted represents the period of time that options granted are expected to be outstanding. The Company uses historical data to estimate option exercise behavior, forfeitures, and to determine this term. The risk-free rate used is based on the U.S. Treasury yield curve in effect at the time of the grant using a time period equal to the expected option term. The Company has never paid dividends and does not expect to pay any dividends in the future. 2019 2018 Expected dividend yield 0 % 0 % Risk free interest rate 1.51% - 2.37 % 1.96% - 2.84 % Expected option term 3.5 years 3.5 - 5 years Turnover/forfeiture rate 0 % 0 % Expected volatility 64% - 67 % 64% - 66 % The Black-Scholes option valuation model and other existing models were developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. These option valuation models require the input of, and are highly sensitive to, subjective assumptions including the expected stock price volatility. The Company's stock options have characteristics significantly different from those of traded options, and changes in the subjective input assumptions could materially affect the fair value estimate. (Loss) Earnings Per Common and Common Equivalent Share The computation of basic (loss) earnings per common share is computed using the weighted average number of common shares outstanding during the year. The computation of diluted (loss) earnings per common share is based on the basic weighted average number of shares outstanding during the year plus common stock equivalents, which would arise from the exercise of options and warrants outstanding using the treasury stock method and the average market price per share during the year. The number of common shares potentially issuable upon the exercise of certain options that were excluded from the diluted loss per common share calculation in 2019 was 891,224 related to options, and 59,918 related to restricted stock, for a total of 951,142 because they are anti-dilutive, as a result of a net loss for the year ended December 31, 2019. The computation of weighted average shares outstanding and the basic and diluted earnings per common share for the years ended December 31, 2019 and 2018 consisted of the following: Net (Loss) Shares Per Share Amount Year ended December 31, 2019 Basic EPS $ (3,142,576 ) 13,387,863 $ (0.23 ) Diluted EPS $ (3,142,576 ) 13,387,863 $ (0.23 ) Net Income Shares Per Share Amount Year ended December 31, 2018: Basic EPS $ 226,344 10,832,209 $ 0.02 Effect of dilutive stock options and warrants 1,030,782 Diluted EPS $ 226,344 11,862,991 $ 0.02 Impairment of Long-Lived Assets The Company continually monitors events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances are present, the Company assesses the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows. If the total of the future cash flows is less than the carrying amount of those assets, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell. Recently Issued Accounting Guidance In February 2016, the FASB issued ASU No. 2016-02, Leases In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other In June 2016, the FASB issued ASU No. 2016-13 , Financial Instruments-Credit Losses , In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes |
Acquisition
Acquisition | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
ACQUISITION | NOTE 3 – ACQUISITIONS On October 17, 2018, we acquired CareSpeak Communications, Inc., a New Jersey corporation and technology solutions company, which provides digital messaging services to the healthcare industry to expand our service offerings. Through its cloud based Mobile Health Messenger ("MHM") Platform, CareSpeak provides interactive health messaging for improved medication adherence, care coordination, and patient engagement. The total purchase price was $8,493,451. Acquisition costs of approximately $607,670 were expensed as incurred. The purchase price contains a contingent element that will be paid only if the Company achieves certain patient engagement revenues in 2019 and 2020. The total contingent payment may be up to $3.0 million. The target patient engagement revenues were achieved in 2019 and are expected to be achieved in 2020. The calculated fair value of the contingent payment is $3,000,000 at December 31, 2019. Purchase Price Allocation The purchase price of the CareSpeak acquisition was allocated as follows: Purchase Price Cash paid $ 5,628,451 Common stock issued 500,000 Contingent payment 2,365,000 Total $ 8,493,451 Allocation Current assets $ 254,263 Property and equipment 8,487 Intangibles Goodwill, including assembled workforce in place 3,678,513 Patent 2,227,000 Tradename 982,000 Non-compete agreements 977,000 Customer relationships 492,000 Current liabilities assumed (125,812 ) Total $ 8,493,451 As described in greater detail in Note 6, the amortizable intangible assets acquired have estimated useful lives ranging from 4 to 15 years. We determined the estimated fair value of the identifiable intangible assets acquired primarily by using the income approach. On October 4, 2019, we acquired RMDY Health, Inc. ("RMDY"), a Delaware corporation and technology solutions company engaged in developing and marketing digital health SAAS solutions across a range of healthcare and life science initiatives, used by pharmaceutical companies, payers, medtech companies, and medical associations nationwide to improve medication adherence and care coordination. The total purchase price was $17,822,162. Acquisition costs of approximately $799,623 were expensed as incurred. The purchase price contains a contingent element that will be paid only if the Company achieves certain revenues related to the legacy RMDY business in 2020 and 2021. The total contingent payment may be up to $30.0 million, with a minimum payment of $1.0 million each year. The calculated fair value of the contingent payment is $3,720,000 at December 31, 2019. The purchase price of the RMDY acquisition was allocated as follows: Purchase Price Cash paid $ 8,994,369 Common stock issued 5,107,793 Contingent payment 3,720,000 Total $ 17,822,162 Allocation Current assets Accounts receivable $ 411,354 Prepaid Expense 12,139 Property and equipment 19,173 Intangibles Goodwill, including assembled workforce in place 11,061,518 Web technology 5,125,000 Tradename 2,604,000 Non-compete agreements 116,000 Customer relationships 431,000 Current liabilities assumed Accounts payable (128,234 ) Accrued expenses (931,828 ) Deferred tax liability (897,960 ) Total $ 17,822,162 As described in greater detail in Note 6, the amortizable intangible assets acquired have estimated useful lives ranging from 2 to 15 years. We determined the estimated fair value of the identifiable intangible assets acquired primarily by using the income approach. Included in accrued expenses is $800,000 withheld at closing as part of an indemnification provision against potential future claims. We began consolidating the results of CareSpeak operations and cashflows into our consolidated financial statements after October 17, 2018, the date of acquisition and the results of RMDY operations and cashflows after October 3, 2019, the date of that acquisition. The unaudited Pro forma results of operations as if both acquisitions had occurred January 1, 2018 are presented in the following table: 2019 2018 As Reported Pro Forma As Reported Pro Forma Revenues $ 24,598,278 $ 26,118,278 $ 21,206,363 $ 24,520,995 Net (Loss) Income (3,142,576 ) (3,869,577 ) 226,344 (564,340 ) (Loss) Earnings per common share: Basic $ (0.23 ) $ (0.29 ) $ 0.02 $ (0.05 ) Diluted $ (0.23 ) $ (0.29 ) $ 0.02 $ (0.05 ) |
Prepaid Expenses
Prepaid Expenses | 12 Months Ended |
Dec. 31, 2019 | |
Prepaid Expenses [Abstract] | |
PREPAID EXPENSES | NOTE 4 – PREPAID EXPENSES Prepaid expenses consisted of the following as of December 31, 2019 and 2018: 2019 2018 Insurance $ 69,250 $ 43,284 Prepaid revenue share payments 201,114 - EHR access fees 313,121 302,527 Other 287,558 14,335 Total prepaid expenses $ 871,043 $ 360,146 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 5 – PROPERTY AND EQUIPMENT The Company owned equipment recorded at cost, which consisted of the following as of December 31, 2019 and 2018: 2019 2018 Computer equipment $ 137,763 $ 94,384 Furniture and fixtures 187,167 159,648 Subtotal 324,930 254,032 Less accumulated depreciation 148,916 104,702 Property and equipment, net $ 176,014 $ 149,330 Depreciation expense was $80,206 and $58,423 for the years ended December 31, 2019 and 2018, respectively. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | NOTE 6 – INTANBIGLE ASSETS Goodwill The goodwill is related to the acquisition of RMDY Health, Inc. in 2019 and CareSpeak Communications in 2018 and is primarily related to expected improvements and technology performance and functionality, sales growth from future product and service offerings and new customers, together with certain intangible assets that do not qualify for separate recognition, such as the assembled workforce in place. Goodwill is generally not amortizable for tax purposes and is not amortizable for financial statement purposes. Intangible Assets Intangible assets included on the balance sheet consist of the following: December 31, 2019 Gross Accumulated Net Weighted Patent rights $ 3,329,457 $ 778,870 $ 2,550,587 11.7 Technology Assets $ 8,140,013 $ 1,901,560 $ 6,238,453 8.0 Other intangible assets Tradename $ 3,586,000 $ 59,767 $ 3,526,233 14.5 Non-compete agreements 1,093,000 309,635 783,365 2.7 Customer relationships 923,000 81,496 841,504 10.5 Total other 5,602,000 450,898 5,151,102 Total Intangibles $ 17,071,470 $ 3,131,328 $ 13,940,142 December 31, 2018 Gross Accumulated Net Weighted Patent rights $ 3,329,457 $ 562,513 $ 2,766,944 12.7 Technology assets $ 1,515,013 $ 1,473,890 $ 104,820 1.1 Other intangible assets Tradename 982,000 - 982,000 Indefinite Non-compete agreements 977,000 50,885 926,115 3.8 Customer relationships 492,000 12,812 479,188 7.8 Total other 2,451,000 63,697 2,387,303 Total Intangibles $ 7,295,470 $ 2,036,403 $ 5,259,067 Intangibles are being amortized on a straight-line basis over the following estimated useful lives. Patents 15 – 17 years Tradenames 15 years Non-compete agreements 2 – 4 years Customer relationships 8 – 15 years Technology assets 3 – 10 years The Company recorded amortization expense of $1,094,924 and $258,079 in the years ended December 31, 2019 and 2018, respectively. Expected future amortization expenses of the intangibles assets as of December 31, 2019 is as follows: Year ended December 31, 2020 $ 1,811,400 2021 1,794,795 2022 1,391,965 2023 990,267 2024 990,267 Thereafter 6,961,448 Total $ 13,940,142 In addition to the technology assets acquired in connection with the RMDY acquisition, the company also acquired software with a cost of $1.5 million in 2019. |
Deferred Revenue
Deferred Revenue | 12 Months Ended |
Dec. 31, 2019 | |
Revenue Recognition [Abstract] | |
DEFERRED REVENUE | NOTE 7 – DEFERRED REVENUE The Company has several signed contracts with customers for the distribution of financial messaging, or other services, which include payment in advance. The payments are not recorded as revenue until the revenue is earned under its revenue recognition policy discussed in Note 2. Deferred revenue was $580,014 and $610,625 as of December 31, 2019 and 2018, respectively. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 8 – RELATED PARTY TRANSACTIONS During the year ended December 31, 2010, the Company acquired the technical contributions and assignment of all exclusive rights to and for a key patent in process at the time from a former CEO in exchange for a total payment in shares of common stock and options valued at $930,000 at the time, and recorded at that cost. That patent remains in Patents on the consolidated balance sheet as of December 31, 2019. During the year ended December 31, 2015, WPP, plc made a strategic investment in the Company and owned approximately 20% of the outstanding shares of the Company until December 2018, when it sold the shares. As of December 31, 2018, WPP was no longer a related party, however the transactions between WPP and the Company while they were a related party are set forth in the table below. The Company considers the pharmaceutical companies being represented by WPP agencies to be its customers and it received no preferable pricing from WPP agencies as a result of its related party status. The following table sets forth the activity between the Company and WPP for the year ended December 31 2018: Total billings to WPP Agencies $ 6,217,735 Revenue recognized from WPP Agencies $ 6,527,051 Accounts receivable $ 2,051,532 |
Contingent Purchase Price
Contingent Purchase Price | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENT PURCHASE PRICE | NOTE 9 – CONTINGENT PURCHASE PRICE Our purchase of CareSpeak Communications contains a contingent element that will be paid only if the Company achieves certain patient engagement revenues in 2019 and 2020. The total contingent payment may be up to $3.0 million. The target patient engagement revenues were achieved in 2019 and are expected to be achieved in 2020. The calculated fair value of the contingent payment was $2,365,000 at December 31, 2018 and $3,000,000 at December 31, 2019. Our purchase of RMDY Health, Inc. also contains a contingent element that will be paid only if the Company achieves certain revenues in 2020 and 2021 related to the RMDY business. The total contingent payment may be up to $30.0 million. The minimum payment is $1.0 million in each of the two years. The calculated fair value of the contingent payment was $3,720,000 at December 31, 2019. We determined the fair value of the Contingent Purchase Price Payable at December 31, 2019 using a Geometric-Brownian motion analysis of the expected revenue and resulting earnout payment using inputs that include the spot price, a risk free rate of return of 1.4%, a term of 2 years, and volatility of 40%. Changes in the inputs could result in a different fair value measurement. The total fair value of contingent purchase price payable at December 31, 2019 is as follows. Current Long-Term Total CareSpeak Communications, Inc. $ 1,500,000 $ 1,500,000 $ 3,000,000 RMDY Health, Inc. - 3,720,000 3,720,000 Total $ 1,500,000 $ 5,220,000 $ 6,720,000 |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | NOTE 10 – STOCKHOLDERS' EQUITY Preferred Stock The Company has 10,000,000 shares of preferred stock, $.001 par value per share, authorized as of December 31, 2019. No shares were issued or outstanding in either 2018 or 2019. Common Stock The Company had 166,666,667 shares of common stock, $.001 par value per share, authorized as of December 31, 2019. There were 14,600,579 and 12,038,618 shares of common stock issued and outstanding at December 31, 2019 and 2018, respectively. Effective May 14, 2018, in connection with our listing on the Nasdaq Capital Market, we implemented a reverse split of our common stock by exchanging each three shares of our common stock for one share. Our financial statements and all equity transactions have been retroactively adjusted to account for the reverse stock split. 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 as a result of this rounding. In connection with this reverse split, our authorized shares were reduced from 500,000,000 to 166,666,667. In 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 at the time, in full payment of all amounts due under a co-marketing agreement that covered certain WPP agencies, whereby we shared a portion of our revenue with those agencies related to new programs through 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 2019, in an underwritten public offering, we issued 1,769,275 shares of our common stock for gross proceeds of $23,000,575. In connection with this transaction, we incurred equity issuance costs of $1,696,749 related to payments to the underwriter, advisors and legal fees associated with the transaction, resulting in net proceeds to the Company of $21,303,826. During 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. The Company has a Director Compensation plan covering its independent non-employee Directors. A total of 33,344 and 36,494 shares were granted and issued in the years ended December 31, 2019 and 2018, respectively, in connection with this compensation plan. These shares were valued at $447,393 and $428,884, respectively. The Company also awarded 130,001 restricted stock awards, valued at $546,007, to executive officers in 2018. These awards would vest only if the Company achieved certain stretch revenue goals in 2018 or 2019. It was determined that the goal was achieved as of December 31, 2018, so the entire expense was recognized in 2018, but the shares related to these awards were issued in 2019. During 2019, we issued 382,893 shares of common stock, valued at $5,107,793, to the former shareholders of RMDY Health, Inc. in connection with the acquisition of RMDY in 2019. We also issued 30,638 shares of common stock, valued at $500,000, to the former shareholders of CareSpeak Communications, Inc., in connection with the acquisition of the CareSpeak in 2018. We issued 246,448 shares of common stock and received proceeds of $877,702 in 2019 in connection with the exercise of options. We also issued 165,169 shares of common stock and received proceeds of $521,270 in 2018 in connection with the exercise of options. During 2018, we issued 15,000 shares of our common stock, valued at $228,050, for investor relations services. During, 2018, we issued 251,046 shares of common stock in connection with the cashless exercise of a warrant to purchase 348,194 shares. We adopted the new accounting standard ASC 606, Revenue from Contracts with Customers, as of January 1, 2018, which resulted in a charge of $142,027 to Retained Earnings on that date. We adopted the new lease accounting standard ASC 842 as of January 1, 2019, which resulted in a charge of $3,229 to Retained Earnings on that date. |
Stock Compensation
Stock Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
STOCK COMPENSATION | NOTE 11 – STOCK COMPENSATION The Company sponsors a stock-based incentive compensation plan known as the 2013 Equity Compensation Plan (the "Plan"), which was established by the Board of Directors of the Company in June 2013. A total of 500,000 shares were initially reserved for issuance under the Plan. The Plan was amended several times since then to eventually increase the authorized shares to 2,500,000 as of December 31, 2019. A total of 1,624,221 shares of common stock underlying options were outstanding at December 31, 2019. The Company had 236,614 remaining shares available to grant under the Plan at December 31, 2019. The Plan allows the Company to grant incentive stock options, non-qualified stock options, stock appreciation rights, or restricted stock. The incentive stock options are exercisable for up to ten years, at an option price per share not less than the fair market value on the date the option is granted. The incentive stock options are limited to persons who are regular full-time employees of the Company at the date of the grant of the option. Non-qualified options may be granted to any person, including, but not limited to, employees, independent agents, consultants and attorneys, who the Company's Board or Compensation Committee believes have contributed, or will contribute, to the success of the Company. Non-qualified options may be issued at option prices of less than fair market value on the date of grant and may be exercisable for up to ten years from date of grant. The option vesting schedule for options granted is determined by the Compensation Committee of the Board of Directors at the time of the grant. The Plan provides for accelerated vesting of unvested options if there is a change in control, as defined in the Plan. The compensation cost that has been charged against income related to options for the years ended December 31, 2019 and 2018, was $1,687,745 and $1,317,904, respectively. No income tax benefit was recognized in the income statement and no compensation was capitalized in any of the years presented. The Company had the following option activity during the years ended December 31, 2019 and 2018: Number of Options Weighted average exercise price Weighted average remaining contractual life (years) Aggregate intrinsic Outstanding, January 1, 2018 1,368,772 $ 3.12 Granted – 2018 401,099 $ 9.27 Exercised – 2018 (165,169 ) $ 3.16 Expired – 2018 (50,002 ) $ 5.48 Outstanding, December 31, 2018 1,554,700 $ 4.63 3.0 Granted – 2019 410,134 $ 12.28 Exercised – 2019 (251,063 ) $ 3.73 Expired – 2019 (89,550 ) $ 12.55 Outstanding, December 31, 2019 1,624,221 $ 6.27 2.6 $ 7,925,643 Exercisable, December 31, 2019 1,143,637 $ 4.39 1.9 $ 7,197,053 Of the options outstanding at December 31, 2019, 1,143,637 were exercisable with a weighted average contractual life of 1.9 years. The table below shows the expiration date and exercise price of the options outstanding at December 31, 2019. Number of Options Exercise Price Expiration Date 175,799 $ 2.46 03/31/22 41,668 $ 3.15 06/24/20 210,520 $ 3.15 07/27/22 470,000 $ 3.21 02/22/21 105,836 $ 3.45 07/28/21 100,006 $ 4.20 02/01/23 8,336 $ 4.62 03/31/23 8,336 $ 4.71 12/31/22 8,000 $ 9.76 12/02/24 139,000 $ 10.18 11/24/24 8,336 $ 10.40 06/30/23 11,800 $ 12.49 08/13/23 6,000 $ 12.51 08/20/23 10,000 $ 12.70 08/22/23 15,000 $ 12.73 09/04/23 14,084 $ 12.77 04/08/24 30,500 $ 13.06 02/27/24 16,000 $ 13.31 06/10/24 40,000 $ 13.34 10/04/24 29,000 $ 14.48 09/30/24 16,000 $ 15.10 05/23/24 12,000 $ 15.32 0715/24 125,000 $ 15.40 10/16/23 16,000 $ 15.51 05/30/24 7,000 $ 16.24 10/22/23 Total 1,624,221 $ 6.27 There is $1,612,382 of expense remaining to be recognized over a period of approximately 1.8 years related to options outstanding at December 31, 2019. In 2019, the Company granted restricted stock awards of 50,000 shares, valued at $653,000, which would vest if the Company achieved certain 2019 revenue targets. The Company did not achieve those targets, so the awards expired unvested on December 31, 2019. The Company also granted a restricted stock award of 90,000 shares, valued at $938,700, and vesting over a period of 5 years. The Company recognized $125,160 expense related to this award in 2019 and $813,540 remains to be recognized at December 31, 2019 over a period of 4.3 years. The Company also awarded 130,001 restricted stock awards, valued at $546,007, in 2018. These awards would vest only if the Company achieved certain stretch revenue goals in 2018 or 2019. It was determined that the goal was achieved as of December 31, 2018, so the entire expense was recognized in 2018, but the shares related to these awards were issued in 2019. |
Warrants
Warrants | 12 Months Ended |
Dec. 31, 2019 | |
Warrants [Abstract] | |
WARRANTS | NOTE 12 –WARRANTS The Company has issued warrants to purchase common stock in the past, primarily in connection with capital raising activities. However, all remaining warrants were exercised in 2018 and there are no remaining warrants outstanding at December 31, 2018 or 2019. The Company had the following warrant activity during the year ended December 31, 2018: Number of Shares Underlying Warrants Weighted average exercise price Balance, December 31, 2017 348,194 $ 3.33 Exercised (348,194 ) $ 3.33 Balance, December 31, 2018 - - |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
LEASES | NOTE 13 – LEASES In February 2016, the Financial Accounting Standards Board ("FASB") issued new accounting guidance on leases. The accounting standard, effective January 1, 2019, requires virtually all leases to be recognized on the balance sheet. Effective January 1, 2019, we adopted the standard using the modified retrospective method, under which we elected the package of practical expedients and transition provisions allowing us to bring our existing operating leases onto the consolidated balance sheet without adjusting comparative periods, but recognizing a cumulative-effect adjustment to the opening balance of accumulated deficit on January 1, 2019. Under the guidance, we have also elected not to separate lease and non-lease components in recognition of the lease-related assets and liabilities, as well as the related lease expense. We have operating leases with terms greater than 12 months for office space in three multitenant facilities, which are recorded as assets and liabilities. The lease on our headquarters space in Rochester, Michigan expires November 30, 2022, with a three-year renewal option through 2025, with monthly rent payable at rates ranging from $6,384 to $6,688. We have assumed renewal of the lease. We also have a lease on office space in Cranbury, New Jersey, expiring in 2022 with monthly payments ranging from $3,008 to $3,158, as well as a lease of approximately $1,883 per month in Zagreb, Croatia expiring in 2022. Lease-related assets, or right-of-use assets, are recognized at the lease commencement date at amounts equal to the respective lease liabilities, adjusted for prepaid lease payments, initial direct costs, and lease incentives received. Lease-related liabilities are recognized at the present value of the remaining contractual fixed lease payments, discounted using our incremental borrowing rate. Operating lease expense is recognized on a straight-line basis over the lease term, while variable lease payments are expensed as incurred. Upon adoption of the standard on January 1, 2019, we recorded approximately $462,000 of right of use assets and $465,000 of lease-related liabilities, with the difference recorded in accumulated deficit as the cumulative effect of change in accounting principle at that date. For the year ended December 31, 2019, the Company's lease cost consisted of the following components, each of which is included in operating expenses within the Company's consolidated statements of operations: Year Ended Operating lease cost $ 132,020 Short-term lease cost (1) 84,935 Total lease cost $ 216,955 (1) Short-term lease cost includes any lease with a term of less than 12 months. The table below presents the future minimum lease payments to be made under operating leases as of December 31, 2019: For the year ending December 31, 2020 $ 138,019 2021 140,367 2022 102,367 2023 99,209 2024 80,375 Thereafter 70,224 Total 630,561 Less: present value discount 66,377 Total lease liabilities $ 564,184 The weighted average remaining lease term for operating leases is 5.1 years and the weighted average discount rate used in calculating the operating lease asset and liability is 4.5%. Cash paid for amounts included in the measurement of lease liabilities was $106,564. For the year ended December 31, 2019, payments on lease obligations were $132,867 and amortization on the right of use assets was $107,656. |
Major Customers and Vendors
Major Customers and Vendors | 12 Months Ended |
Dec. 31, 2019 | |
Major Customers [Abstract] | |
MAJOR CUSTOMERS AND VENDORS | NOTE 14 – MAJOR CUSTOMERS AND VENDORS The Company had the following customers that accounted for 10% or greater of revenue in either 2019 or 2018. No other customers accounted for more than 10% of revenue in either year presented. 2019 2018 $ % $ % Customer A 3,883,589 15.8 1,678,669 7.9 Customer B 2,801,748 11.4 930,682 4.4 Customer C 2,533,766 10.3 2,122,657 10.0 Customer D 1,349,214 5.5 2,547,113 12.0 Customer E - 0 2,280,873 10.8 Our accounts receivable includes 3 customers that individually make up more than 10% of our accounts receivable at December 31, 2019 in the percentages of 17.8%, 15.4% and 13.3%. The Company had four key partners through which 10% or greater of its revenue was generated in either 2019 or 2018 as set forth below. The amounts in the table below reflect the amount of revenue generated through those customers. 2019 2018 $ % $ % Partner A 1,315,706 5.3 6,841,386 32.3 Partner B 9,210,347 37.4 5,350,393 25.2 Partner C 4,051,217 16.5 2,584,103 12.2 Partner D 1,007,573 4.1 2,159,356 10.2 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 15 – INCOME TAXES As of December 31, 2019, the Company had net operating loss carry-forwards for federal income tax purposes of approximately $18.3 million, consisting of pre-2018 losses in the amount of approximately $14.3 million that expire from 2020 through 2037, and post-2017 losses in the amount of approximately $4 million that never expire. These net operating losses are available to offset future taxable income. The Company was formed in 2006 as a limited liability company and changed to a corporation in 2007. Activity prior to incorporation is not reflected in the Company's corporate tax returns. In the future, the cumulative net operating loss carry-forward for income tax purposes may differ from the cumulative financial statement loss due to timing differences between book and tax reporting. The provision for Federal income tax consists of the following for the years ended December 31, 2019 and 2018: 2019 2018 Federal income tax benefit (expense) attributable to: Current operations $ 848,000 $ (48,000 ) Acquisition costs (143,000 ) - Change in fair value of contingent consideration (133,000 ) - Other permanent items 29,000 (36,000 ) Deferred Adjustment (913,000 ) - Valuation allowance 1,209,960 84,000 Net provision for federal income tax $ 897,960 $ - 2019 2018 Current tax benefit (expense) - Federal $ - $ - Deferred tax benefit (expense) - Federal - - Adjustment of valuation allowance from business combination 897,960 - Total tax benefit (expense) on income $ 897,960 $ - The cumulative tax effect of significant items comprising our net deferred tax amount at the expected rate of 21% is as follows as of December 31, 2019 and 2018: 2019 2018 Deferred tax asset attributable to: Net operating loss carryover $ 3,839,000 $ 2,290,000 Stock compensation 320,000 535,000 Intangible Assets - 124,000 Other 36,000 3,000 Deferred tax asset $ 4,195,000 $ 2,952,000 Deferred tax liabilities attributable to: Fixed assets $ (13,000 ) $ (5,000 ) Intangibles (2,438,000 ) - Other (16,000 ) (9,000 ) Valuation allowance (1,728,000 ) (2,938,000 ) Deferred tax liability $ (4,195,000 ) $ (2,952,000 ) Net deferred tax asset $ - $ - The ultimate realization of deferred tax assets is dependent upon the Company's ability to generate sufficient taxable income during the periods in which the net operating losses expire and the temporary differences become deductible. The Company has determined that there is significant uncertainty that the results of future operations and the reversals of existing taxable temporary differences will generate sufficient taxable income to realize the deferred tax assets; therefore, a valuation allowance has been recorded. In making this determination, the Company considered historical levels of income as well as projections for future periods. The tax years 2016 to 2019 remain open for potential audit by the Internal Revenue Service. There are no uncertain tax positions as of December 31, 2018 or December 31, 2019, and none are expected in the next 12 months. The Company's foreign subsidiaries are cost centers that are reimbursed for expenses, so generate no income or loss. Pretax book income (loss) is all from domestic operations. Up to four years of returns remain open for potential audit in foreign jurisdictions, however any audits for periods prior to ownership by the Company are the responsibility of the previous owners. Under certain circumstances issuance of common shares can result in an ownership change under Internal Revenue Code Section 382, which limits the Company's ability to utilize carry-forwards from prior to the ownership change. Any such ownership change resulting from stock issuances and redemptions could limit the Company's ability to utilize any net operating loss carry-forwards or credits generated before this change in ownership. These limitations can limit both the timing of usage of these laws, as well as the loss of the ability to use these net operating losses. It is likely that fundraising activities have resulted in such an ownership change. |
Commitments and Contingent Liab
Commitments and Contingent Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENT LIABILITIES | NOTE 16 – COMMITMENTS AND CONTINGENT LIABILITIES Legal The Company is not involved in any legal proceedings. Revenue-share contracts The Company has contacts with various electronic health records systems and ePrescribe platforms, whereby we agree to share a portion of the revenue we generate for eCoupons distributed through their networks. These contracts grant audit rights related to the payments to our partners, and, in some cases would require us to pay for the audit if the audit determined there was an underpayment and the underpayment meets certain thresholds, such as 10%. |
Retirement Plan
Retirement Plan | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |
RETIREMENT PLAN | NOTE 17 – RETIREMENT PLAN The Company sponsors a defined contribution 401(k) profit sharing plan which was adopted in December 2015, effective in January 2016. Under the terms of the plan, the Company matches 100% of the first 3% of payroll contributed by the employee and 50% of the next 2% of payroll contributed by the employee to a maximum of 4% of an employee's payroll. There was expense of $126,557 and $172,107 recorded in 2019 and 2018, respectively, for company contributions to the plan. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 18 – SUBSEQUENT EVENTS In March 2020, the Company's Board of Directors amended the 2013 Equity Compensation Plan to increase the number of shares authorized under the plan to 3.0 million shares. At the same time, the Company granted 84,746 shares of restricted common stock and options to purchase 233,049 shares of common stock to officers that vest over the balance of 2020. The Board also granted options to purchase 33,000 shares of common stock to a non-officer, that were fully vested at the time of grant and 38,000 time-based options to new employees. In 2020, the company issued 35,032 shares and received proceeds of $112,151 in connection with the exercise of options. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Estimates and assumptions have been made in determining the carrying value of assets, depreciable and amortizable lives of tangible and intangible assets, the carrying value of liabilities, the valuation allowance for the deferred tax asset, the timing of revenue recognition and related revenue share expenses, and inputs used in the calculation of stock based compensation. Actual results could differ from these estimates. |
Principles of Consolidation | Principles of Consolidation The financial statements reflect the consolidated results of OptimizeRx Corporation, a Nevada corporation, and its wholly owned subsidiaries: OptimizeRx Corporation, a Michigan corporation, RMDY Health, Inc., a Delaware corporation, CareSpeak Communications, Inc., a New Jersey corporation, Cyberdiet, a controlled foreign corporation incorporated in Israel, and CareSpeak Communications D.O.O., a Controlled Foreign Corporation incorporated in Croatia. Together, these companies are referred to as "OptimizeRx" and "the Company." All material intercompany transactions have been eliminated. |
Reclassifications | Reclassifications Certain items in the previous year financial statements have been reclassified to match the current year presentation. |
Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of the accompanying financial statements, the Company considers all highly liquid instruments, consisting of money market accounts, with an initial maturity of three months or less to be cash equivalents. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is defined as 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 and in the principal or most advantageous market for that asset or liability. The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk including our own credit risk. In addition to defining fair value, the disclosure requirements around fair value establish a fair value hierarchy for valuation inputs, which is expanded. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels, which is determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are: Level 1 – Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets. Level 2 – Inputs are based upon significant observable inputs other than quoted prices included in Level 1, such as quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Inputs are generally unobservable and typically reflect management's estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques. The Company's stock options and warrants are valued using level 3 inputs. The following tables present the fair values and carrying values of the Company's financial assets and liabilities measured on a recurring basis as of December 31, 2019 and 2018 and the valuation techniques used by the Company to determine those fair values. 2019 Level 1 Level 2 Level 3 Fair Value Carrying Value Liabilities Contingent Purchase Price Payable (1) $ - $ - $ 6,720,000 $ 6,720,000 $ 6,720,000 2018 Level 1 Level 2 Level 3 Fair Value Carrying Value Liabilities Contingent Purchase Price Payable (1) $ - $ - $ 2,365,000 $ 2,365,000 $ 2,365,000 (1) The contingent consideration is based off achieving certain revenue milestones in each of the next two years. The Geometric-Brownian motion analysis was used to generate spot prices for use in an option pricing model. For 2018, the hypothetical spot prices were simulated using a monte carlo simulation utilizing 2018 revenue as a base and revenue volatility of 37%. The risk-free rate of return and terms utilized were 2.89% and 1.46-2.46, respectively, and expected volatility was 35%. For 2019, the hypothetical spot prices were simulated using a monte carlo simulation utilizing 2020 and 2021 revenue projections and revenue volatility of 40%. The risk-free rate of return and terms utilized were 1.40% and 1 -2 years, respectively, and expected volatility was 40%. The following table provides a summary of changes in fair value of the Company's Level 3 financial instruments for the years ended December 31, 2019 and 2018. Amount Balance December 31, 2017 $ - Contingent consideration liability recorded as the result of the CareSpeak Communications acquisition (see note 3) 2,365,000 Balance December 31, 2018 2,365,000 Increase in fair value of CareSpeak Communications contingent consideration 635,000 Contingent consideration liability recorded as the result of the RMDY Health, Inc. acquisition (see note 3) 3,720,000 Balance December 31, 2019 $ 6,720,000 |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are reported at realizable value, net of allowances for doubtful accounts, which is estimated and recorded in the period the related revenue is recorded. The Company has a standardized approach to estimate and review the collectability of its receivables based on a number of factors, including the period they have been outstanding. Historical collection and payer reimbursement experience is an integral part of the estimation process related to allowances for doubtful accounts. In addition, the Company regularly assesses the state of its billing operations in order to identify issues, which may impact the collectability of these receivables or reserve estimates. Because the Company's customers are primarily large well-capitalized companies, historically there has been very little bad debt expense. Bad debt expense was $80,000 for the year ended December 31, 2019 and $0 for the year ended December 31, 2018. The allowance for doubtful accounts was $80,000 and $0 as of Decembers 31, 2019 and 2018, respectively. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost and are being depreciated over their estimated useful lives of three to five years for office equipment and three years for computer equipment using the straight-line method of depreciation for book purposes. Maintenance and repair charges are expensed as incurred. |
Intangible Assets | Intangible Assets Intangible assets are stated at cost. Finite-lived assets are being amortized over their estimated useful lives of fifteen to seventeen years for patents, eight years for customer relationships, fifteen years for tradenames, four years for covenants not to compete, and three to four years for software and websites, all using the straight-line method. These assets, as well as our indefinite-lived asset, are evaluated annually in our fiscal fourth quarter for impairment. |
Goodwill | Goodwill We evaluate goodwill for impairment during our fiscal fourth quarter, or more frequently if an event occurs or circumstances change. |
Revenue Recognition | Revenue Recognition Recognition of revenue requires evidence of a contract, probable collection of proceeds, and completion of substantially all performance obligations. We use a 5-step model to recognize revenue. These steps are: identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when or as the performance obligations are satisfied. Revenues are primarily generated from content delivery activities in which the Company delivers financial, clinical, or brand messaging through a distribution network of eprescribers and electronic health record technology providers (channel partners), directly to consumers, or from reselling services that complement the business. Unless otherwise specified, revenue is recognized based on the gross selling price to customers. The Company's contracts are generally all less than one year and the primary performance obligation is delivery of messages, but the contract may contain additional performance obligations. Additional performance obligations may include program design and set up, and reporting. As the messaging is distributed through the platform and network of channel partners (a transaction), these transactions are recorded, and revenue is recognized, at the time of distribution. Revenue for transactions can be realized based on a price per message, a price per redemption, as a flat fee occurring over a period of time, or upon completion of the program, depending on the client contract. The Company recognizes setup fees that are required for integrating client offerings and campaigns into the rule-based content delivery system and network over the life of the initial program, based either on time, or units delivered, depending upon which is most appropriate in the specific situation. Should a program be cancelled before completion, the balance of set up revenue is recognized at the time of cancellation, as set up fees are nonrefundable. Additionally, the Company also recognizes revenue for providing program performance reporting and maintenance, either by the Company directly delivering reports or by providing access to its online reporting portal that the client can utilize. These fees are charged monthly and recognized as recurring monthly revenue at the time of delivery. In some instances, the Company also resells products and or services that are available through channel partners on a commission basis, and that are complementary to the core business and client base. In these instances, net revenue is recognized based on the commission-based revenue split that the Company receives. In instances where the Company resells services and have all financial risk and significant operation input and risk, the Company records the revenue gross. |
Cost of Revenues | Cost of Revenues The primary cost of revenue is revenue share expense. Based on the volume of transactions that are delivered through the channel partner network, the Company provides a revenue share to compensate the partner, or others, for their promotion of the campaign. Revenue shares are a negotiated percentage of the transaction fees and can also be specific to special considerations and campaigns. |
Income Taxes | Income Taxes Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax basis of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized. The Company recognizes the tax benefit from uncertain tax positions if it is more likely than not that the tax positions will be sustained on examination by the tax authorities, based on the technical merits of the position. The tax benefit is measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. It is the Company's policy to include interest and penalties related to tax positions as a component of income tax expense. |
Concentration of Credit Risks | Concentration of Credit Risks The Company maintains its cash and cash equivalents in bank deposit accounts, which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts; however, amounts in excess of the federally insured limit may be at risk if the bank experiences financial difficulties. As of December 31, 2019 and 2018 the Company had $18,047,903 and $8,414,034, respectively, in cash balances in excess of federally insured limits, primarily at Bank of America/Merrill Lynch. |
Research and Development | Research and Development The Company expenses research and development expenses as incurred. Research and development expense was $1,604,195 and $0 in 2019 and 2018, respectively. |
Stock-based Compensation | Stock-based Compensation The Company uses the fair value method to account for stock-based compensation. The fair value of the equity instrument is charged directly to compensation expense and additional paid-in capital over the period during which services are rendered. The fair value of each award is estimated on the date of each grant. For restricted stock, the fair market value is based on the market value of the stock granted on the date of the grant. For options, it is estimated using the Black-Scholes option pricing model that uses the assumptions noted in the following table. Estimated volatilities are based on the historical volatility of the Company's stock over the same period as the expected term of the options. The expected term of options granted represents the period of time that options granted are expected to be outstanding. The Company uses historical data to estimate option exercise behavior, forfeitures, and to determine this term. The risk-free rate used is based on the U.S. Treasury yield curve in effect at the time of the grant using a time period equal to the expected option term. The Company has never paid dividends and does not expect to pay any dividends in the future. 2019 2018 Expected dividend yield 0 % 0 % Risk free interest rate 1.51% - 2.37 % 1.96% - 2.84 % Expected option term 3.5 years 3.5 - 5 years Turnover/forfeiture rate 0 % 0 % Expected volatility 64% - 67 % 64% - 66 % The Black-Scholes option valuation model and other existing models were developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. These option valuation models require the input of, and are highly sensitive to, subjective assumptions including the expected stock price volatility. The Company's stock options have characteristics significantly different from those of traded options, and changes in the subjective input assumptions could materially affect the fair value estimate. |
(Loss) Earnings Per Common and Common Equivalent Share | (Loss) Earnings Per Common and Common Equivalent Share The computation of basic (loss) earnings per common share is computed using the weighted average number of common shares outstanding during the year. The computation of diluted (loss) earnings per common share is based on the basic weighted average number of shares outstanding during the year plus common stock equivalents, which would arise from the exercise of options and warrants outstanding using the treasury stock method and the average market price per share during the year. The number of common shares potentially issuable upon the exercise of certain options that were excluded from the diluted loss per common share calculation in 2019 was 891,224 related to options, and 59,918 related to restricted stock, for a total of 951,142 because they are anti-dilutive, as a result of a net loss for the year ended December 31, 2019. The computation of weighted average shares outstanding and the basic and diluted earnings per common share for the years ended December 31, 2019 and 2018 consisted of the following: Net (Loss) Shares Per Share Amount Year ended December 31, 2019 Basic EPS $ (3,142,576 ) 13,387,863 $ (0.23 ) Diluted EPS $ (3,142,576 ) 13,387,863 $ (0.23 ) Net Income Shares Per Share Amount Year ended December 31, 2018: Basic EPS $ 226,344 10,832,209 $ 0.02 Effect of dilutive stock options and warrants 1,030,782 Diluted EPS $ 226,344 11,862,991 $ 0.02 |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company continually monitors events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances are present, the Company assesses the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows. If the total of the future cash flows is less than the carrying amount of those assets, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell. |
Recently Issued Accounting Guidance | Recently Issued Accounting Guidance In February 2016, the FASB issued ASU No. 2016-02, Leases In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other In June 2016, the FASB issued ASU No. 2016-13 , Financial Instruments-Credit Losses , In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of financial assets and liabilities measured on a recurring basis | 2019 Level 1 Level 2 Level 3 Fair Value Carrying Value Liabilities Contingent Purchase Price Payable (1) $ - $ - $ 6,720,000 $ 6,720,000 $ 6,720,000 2018 Level 1 Level 2 Level 3 Fair Value Carrying Value Liabilities Contingent Purchase Price Payable (1) $ - $ - $ 2,365,000 $ 2,365,000 $ 2,365,000 (1) The contingent consideration is based off achieving certain revenue milestones in each of the next two years. The Geometric-Brownian motion analysis was used to generate spot prices for use in an option pricing model. For 2018, the hypothetical spot prices were simulated using a monte carlo simulation utilizing 2018 revenue as a base and revenue volatility of 37%. The risk-free rate of return and terms utilized were 2.89% and 1.46-2.46, respectively, and expected volatility was 35%. For 2019, the hypothetical spot prices were simulated using a monte carlo simulation utilizing 2020 and 2021 revenue projections and revenue volatility of 40%. The risk-free rate of return and terms utilized were 1.40% and 1 -2 years, respectively, and expected volatility was 40%. |
Schedule of changes in fair value of the Company’s Level 3 financial instruments | Amount Balance December 31, 2017 $ - Contingent consideration liability recorded as the result of the CareSpeak Communications acquisition (see note 3) 2,365,000 Balance December 31, 2018 2,365,000 Increase in fair value of CareSpeak Communications contingent consideration 635,000 Contingent consideration liability recorded as the result of the RMDY Health, Inc. acquisition (see note 3) 3,720,000 Balance December 31, 2019 $ 6,720,000 |
Schedule of expected dividends | 2019 2018 Expected dividend yield 0 % 0 % Risk free interest rate 1.51% - 2.37 % 1.96% - 2.84 % Expected option term 3.5 years 3.5 - 5 years Turnover/forfeiture rate 0 % 0 % Expected volatility 64% - 67 % 64% - 66 % |
Schedule of weighted average shares outstanding and the basic and diluted earnings per common share | Net (Loss) Shares Per Share Amount Year ended December 31, 2019 Basic EPS $ (3,142,576 ) 13,387,863 $ (0.23 ) Diluted EPS $ (3,142,576 ) 13,387,863 $ (0.23 ) Net Income Shares Per Share Amount Year ended December 31, 2018: Basic EPS $ 226,344 10,832,209 $ 0.02 Effect of dilutive stock options and warrants 1,030,782 Diluted EPS $ 226,344 11,862,991 $ 0.02 |
Acquisition (Tables)
Acquisition (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Schedule of pro forma results of operations | 2019 2018 As Reported Pro Forma As Reported Pro Forma Revenues $ 24,598,278 $ 26,118,278 $ 21,206,363 $ 24,520,995 Net (Loss) Income (3,142,576 ) (3,869,577 ) 226,344 (564,340 ) (Loss) Earnings per common share: Basic $ (0.23 ) $ (0.29 ) $ 0.02 $ (0.05 ) Diluted $ (0.23 ) $ (0.29 ) $ 0.02 $ (0.05 ) |
CareSpeak acquisition [Member] | |
Schedule of purchase price of the acquisition | Purchase Price Cash paid $ 5,628,451 Common stock issued 500,000 Contingent payment 2,365,000 Total $ 8,493,451 Allocation Current assets $ 254,263 Property and equipment 8,487 Intangibles Goodwill, including assembled workforce in place 3,678,513 Patent 2,227,000 Tradename 982,000 Non-compete agreements 977,000 Customer relationships 492,000 Current liabilities assumed (125,812 ) Total $ 8,493,451 |
RMDY acquisition [Member] | |
Schedule of purchase price of the acquisition | Purchase Price Cash paid $ 8,994,369 Common stock issued 5,107,793 Contingent payment 3,720,000 Total $ 17,822,162 Allocation Current assets Accounts receivable $ 411,354 Prepaid Expense 12,139 Property and equipment 19,173 Intangibles Goodwill, including assembled workforce in place 11,061,518 Web technology 5,125,000 Tradename 2,604,000 Non-compete agreements 116,000 Customer relationships 431,000 Current liabilities assumed Accounts payable (128,234 ) Accrued expenses (931,828 ) Deferred tax liability (897,960 ) Total $ 17,822,162 |
Prepaid Expenses (Tables)
Prepaid Expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Prepaid Expenses [Abstract] | |
Schedule of prepaid expenses | 2019 2018 Insurance $ 69,250 $ 43,284 Prepaid revenue share payments 201,114 - EHR access fees 313,121 302,527 Other 287,558 14,335 Total prepaid expenses $ 871,043 $ 360,146 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | 2019 2018 Computer equipment $ 137,763 $ 94,384 Furniture and fixtures 187,167 159,648 Subtotal 324,930 254,032 Less accumulated depreciation 148,916 104,702 Property and equipment, net $ 176,014 $ 149,330 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | December 31, 2019 Gross Accumulated Net Weighted Patent rights $ 3,329,457 $ 778,870 $ 2,550,587 11.7 Technology Assets $ 8,140,013 $ 1,901,560 $ 6,238,453 8.0 Other intangible assets Tradename $ 3,586,000 $ 59,767 $ 3,526,233 14.5 Non-compete agreements 1,093,000 309,635 783,365 2.7 Customer relationships 923,000 81,496 841,504 10.5 Total other 5,602,000 450,898 5,151,102 Total Intangibles $ 17,071,470 $ 3,131,328 $ 13,940,142 December 31, 2018 Gross Accumulated Net Weighted Patent rights $ 3,329,457 $ 562,513 $ 2,766,944 12.7 Technology assets $ 1,515,013 $ 1,473,890 $ 104,820 1.1 Other intangible assets Tradename 982,000 - 982,000 Indefinite Non-compete agreements 977,000 50,885 926,115 3.8 Customer relationships 492,000 12,812 479,188 7.8 Total other 2,451,000 63,697 2,387,303 Total Intangibles $ 7,295,470 $ 2,036,403 $ 5,259,067 |
Schedule of intangibles estimated useful lives | Patents 15 - 17 years Tradenames 15 years Non-compete agreements 2 - 4 years Customer relationships 8 - 15 years Technology assets 3 - 10 years |
Schedule of future amortization expenses of intangibles assets | Year ended December 31, 2020 $ 1,811,400 2021 1,794,795 2022 1,391,965 2023 990,267 2024 990,267 Thereafter 6,961,448 Total $ 13,940,142 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of sets forth the activity between the Company and WPP | Total billings to WPP Agencies $ 6,217,735 Revenue recognized from WPP Agencies $ 6,527,051 Accounts receivable $ 2,051,532 |
Contingent Purchase Price (Tabl
Contingent Purchase Price (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
fair value of contingent purchase price payable | Current Long-Term Total CareSpeak Communications, Inc. $ 1,500,000 $ 1,500,000 $ 3,000,000 RMDY Health, Inc. - 3,720,000 3,720,000 Total $ 1,500,000 $ 5,220,000 $ 6,720,000 |
Stock Compensation (Tables)
Stock Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of option activity | Number of Options Weighted average exercise price Weighted average remaining contractual life (years) Aggregate intrinsic value $ Outstanding, January 1, 2018 1,368,772 $ 3.12 Granted – 2018 401,099 $ 9.27 Exercised – 2018 (165,169 ) $ 3.16 Expired – 2018 (50,002 ) $ 5.48 Outstanding, December 31, 2018 1,554,700 $ 4.63 3.0 Granted – 2019 410,134 $ 12.28 Exercised – 2019 (251,063 ) $ 3.73 Expired – 2019 (89,550 ) $ 12.55 Outstanding, December 31, 2019 1,624,221 $ 6.27 2.6 $ 7,925,643 Exercisable, December 31, 2019 1,143,637 $ 4.39 1.9 $ 7,197,053 |
Schedule of expiration date and exercise price of the options outstanding | Number of Options Exercise Price Expiration Date 175,799 $ 2.46 03/31/22 41,668 $ 3.15 06/24/20 210,520 $ 3.15 07/27/22 470,000 $ 3.21 02/22/21 105,836 $ 3.45 07/28/21 100,006 $ 4.20 02/01/23 8,336 $ 4.62 03/31/23 8,336 $ 4.71 12/31/22 8,000 $ 9.76 12/02/24 139,000 $ 10.18 11/24/24 8,336 $ 10.40 06/30/23 11,800 $ 12.49 08/13/23 6,000 $ 12.51 08/20/23 10,000 $ 12.70 08/22/23 15,000 $ 12.73 09/04/23 14,084 $ 12.77 04/08/24 30,500 $ 13.06 02/27/24 16,000 $ 13.31 06/10/24 40,000 $ 13.34 10/04/24 29,000 $ 14.48 09/30/24 16,000 $ 15.10 05/23/24 12,000 $ 15.32 0715/24 125,000 $ 15.40 10/16/23 16,000 $ 15.51 05/30/24 7,000 $ 16.24 10/22/23 Total 1,624,221 $ 6.27 |
Warrants (Tables)
Warrants (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Warrants [Abstract] | |
Schedule of warrant activity | Number of Shares Underlying Warrants Weighted average exercise price Balance, December 31, 2017 348,194 $ 3.33 Exercised (348,194 ) $ 3.33 Balance, December 31, 2018 - - |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Schedule of lease cost | Year Ended Operating lease cost $ 132,020 Short-term lease cost (1) 84,935 Total lease cost $ 216,955 (1) Short-term lease cost includes any lease with a term of less than 12 months. |
Schedule of future minimum lease payments | For the year ending December 31, 2020 $ 138,019 2021 140,367 2022 102,367 2023 99,209 2024 80,375 Thereafter 70,224 Total 630,561 Less: present value discount 66,377 Total lease liabilities $ 564,184 |
Major Customers and Vendors (Ta
Major Customers and Vendors (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Customers [Member] | |
Schedule of accounted percentage of revenue | 2019 2018 $ % $ % Customer A 3,883,589 15.8 1,678,669 7.9 Customer B 2,801,748 11.4 930,682 4.4 Customer C 2,533,766 10.3 2,122,657 10.0 Customer D 1,349,214 5.5 2,547,113 12.0 Customer E - 0 2,280,873 10.8 |
Key Partners [Member] | |
Schedule of accounted percentage of revenue | 2019 2018 $ % $ % Partner A 1,315,706 5.3 6,841,386 32.3 Partner B 9,210,347 37.4 5,350,393 25.2 Partner C 4,051,217 16.5 2,584,103 12.2 Partner D 1,007,573 4.1 2,159,356 10.2 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of federal income tax benefit | 2019 2018 Federal income tax benefit (expense) attributable to: Current operations $ 848,000 $ (48,000 ) Acquisition costs (143,000 ) - Change in fair value of contingent consideration (133,000 ) - Other permanent items 29,000 (36,000 ) Deferred Adjustment (913,000 ) - Valuation allowance 1,209,960 84,000 Net provision for federal income tax $ 897,960 $ - 2019 2018 Current tax benefit (expense) - Federal $ - $ - Deferred tax benefit (expense) - Federal - - Adjustment of valuation allowance from business combination 897,960 - Total tax benefit (expense) on income $ 897,960 $ - |
Schedule of deferred tax assets | 2019 2018 Deferred tax asset attributable to: Net operating loss carryover $ 3,839,000 $ 2,290,000 Stock compensation 320,000 535,000 Intangible Assets - 124,000 Other 36,000 3,000 Deferred tax asset $ 4,195,000 $ 2,952,000 Deferred tax liabilities attributable to: Fixed assets $ (13,000 ) $ (5,000 ) Intangibles (2,438,000 ) - Other (16,000 ) (9,000 ) Valuation allowance (1,728,000 ) (2,938,000 ) Deferred tax liability $ (4,195,000 ) $ (2,952,000 ) Net deferred tax asset $ - $ - |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 | |
Liabilities | |||
Contingent Purchase Price Payable | [1] | $ 6,720,000 | $ 2,365,000 |
Fair Value, Measurements, Recurring [Member] | |||
Liabilities | |||
Contingent Purchase Price Payable | [1] | 6,720,000 | 2,365,000 |
Fair Value Inputs Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | |||
Liabilities | |||
Contingent Purchase Price Payable | [1] | ||
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | |||
Liabilities | |||
Contingent Purchase Price Payable | [1] | ||
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | |||
Liabilities | |||
Contingent Purchase Price Payable | [1] | $ 6,720,000 | $ 2,365,000 |
[1] | The contingent consideration is based off achieving certain revenue milestones in each of the next two years. The Geometric-Brownian motion analysis was used to generate spot prices for use in an option pricing model. For 2018, the hypothetical spot prices were simulated using a monte carlo simulation utilizing 2018 revenue as a base and revenue volatility of 37%. The risk-free rate of return and terms utilized were 2.89% and 1.46-2.46, respectively and expected volatility was 35%. For 2019, the hypothetical spot prices were simulated using a monte carlo simulation utilizing 2020 and 2021 revenue projections and revenue volatility of 40%. The risk-free rate of return and terms utilized were 1.40% and 1 -2 years, respectively and expected volatility was 40%. |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Summary Of Significant Accounting Policies [Line Items] | ||
Balance | $ 2,365,000 | |
Contingent consideration liability recorded as the result of the CareSpeak Communications acquisition (see note 3) | 2,365,000 | |
Balance | 2,365,000 | |
Fair Value, Inputs, Level 3 [Member] | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Balance | 635,000 | |
Contingent consideration liability recorded as the result of the CareSpeak Communications acquisition (see note 3) | 3,720,000 | |
Balance | $ 6,720,000 | $ 635,000 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details 2) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology | ||
Expected dividend yield | 0.00% | 0.00% |
Risk free interest rate minimum | 1.51% | 1.96% |
Risk free interest rate maximum | 2.37% | 2.84% |
Expected option term | 3 years 6 months | |
Turnover/forfeiture rate | 0.00% | 0.00% |
Expected volatility minimum | 64.00% | 64.00% |
Expected volatility maximum | 67.00% | 66.00% |
Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology | ||
Expected option term | 5 years | |
Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology | ||
Expected option term | 3 years 6 months |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Details 3) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Accounting Policies [Abstract] | ||
Basic EPS, Net Income | $ (3,142,576) | $ 226,344 |
Diluted EPS, Net Income | $ (3,142,576) | $ 226,344 |
Basic EPS, Shares | 13,387,863 | 10,832,209 |
Effect of dilutive stock options and warrants, shares | 1,030,782 | |
Diluted EPS, Shares | 13,387,863 | 11,862,991 |
Basic EPS, Per Share Amount | $ (0.23) | $ 0.02 |
Diluted EPS, Per Share Amount | $ (0.23) | $ 0.02 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Summary Of Significant Accounting Policies [Line Items] | ||
Bad debt expense | $ 80,000 | |
Allowance for doubtful accounts | 80,000 | 0 |
Research and development expense | $ 1,604,195 | 0 |
Number of common shares potentially issuable upon the exercise of certain options and warrants | 891,224 | |
Cash balances for insured limits | $ 18,047,903 | $ 8,414,034 |
Increase in deferred revenue | $ (3,229) | |
Contingent consideration, description | The hypothetical spot prices were simulated using a monte carlo simulation utilizing 2018 revenue as a base and revenue volatility of 37%. The risk-free rate of return and terms utilized were 2.89% and 1.46-2.46, respectively and expected volatility was 35%. For 2019, the hypothetical spot prices were simulated using a monte carlo simulation utilizing 2020 and 2021 revenue projections and revenue volatility of 40%. The risk-free rate of return and terms utilized were 1.40% and 1 -2 years, respectively and expected volatility was 40%. | |
Percentage of realized upon ultimate settlement | 50.00% | |
Restricted stock | 951,142 | |
Restricted Stock [Member] | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Restricted stock | 59,918 |
Acquisition (Details)
Acquisition (Details) - USD ($) | 12 Months Ended | ||
Oct. 04, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Accrued expenses | $ (1,800,635) | $ (1,300,882) | |
CareSpeak acquisition [Member] | |||
Cash paid | 5,628,451 | ||
Common stock issued | 500,000 | ||
Contingent payment | 2,365,000 | ||
Total | 8,493,451 | ||
Current assets | 254,263 | ||
Property and equipment | 8,487 | ||
Intangibles | |||
Current liabilities assumed | (125,812) | ||
Total | 8,493,451 | ||
CareSpeak acquisition [Member] | Goodwill [Member] | |||
Intangibles | 3,678,513 | ||
CareSpeak acquisition [Member] | Patent [Member] | |||
Intangibles | 2,227,000 | ||
CareSpeak acquisition [Member] | Trade Name [Member] | |||
Intangibles | 982,000 | ||
CareSpeak acquisition [Member] | Non-compete Agreements [Member] | |||
Intangibles | 977,000 | ||
CareSpeak acquisition [Member] | Customer relationships [Member] | |||
Intangibles | 492,000 | ||
RMDY acquisition [Member] | |||
Cash paid | 8,994,369 | ||
Common stock issued | 5,107,793 | ||
Contingent payment | 3,720,000 | ||
Total | $ 17,822,162 | 17,822,162 | |
Accounts receivable | 411,354 | ||
Prepaid Expense | 12,139 | ||
Property and equipment | 19,173 | ||
Intangibles | |||
Current liabilities assumed | (1,060,062) | ||
Accounts payable | (128,234) | ||
Accrued expenses | (128,234) | ||
Deferred tax liability | (897,960) | ||
Total | 17,822,162 | ||
RMDY acquisition [Member] | Goodwill [Member] | |||
Intangibles | 11,061,518 | ||
RMDY acquisition [Member] | Non-compete Agreements [Member] | |||
Intangibles | 116,000 | ||
RMDY acquisition [Member] | Customer relationships [Member] | |||
Intangibles | 431,000 | ||
RMDY acquisition [Member] | Web technology [Member] | |||
Intangibles | 5,125,000 | ||
RMDY acquisition [Member] | Tradename [Member] | |||
Intangibles | $ 2,604,000 |
Acquisition (Details 1)
Acquisition (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues | $ 24,598,274 | $ 21,206,363 |
Net (Loss) Income | $ (4,040,536) | $ 226,344 |
(Loss) Earnings per common share: | ||
Basic | $ (0.23) | $ 0.02 |
Diluted | $ (0.23) | $ 0.02 |
Pro Forma [Member] | ||
Revenues | $ 26,118,278 | $ 24,520,995 |
Net (Loss) Income | $ (3,869,577) | $ (564,340) |
(Loss) Earnings per common share: | ||
Basic | $ (0.29) | $ (0.05) |
Diluted | $ (0.29) | $ (0.05) |
Acquisition (Details Textual)
Acquisition (Details Textual) - USD ($) | 12 Months Ended | ||
Oct. 04, 2020 | Dec. 31, 2019 | Oct. 04, 2019 | |
Acquisition (Textual) | |||
Total contingent payment | $ 3,720,000 | ||
Fair value of contingent payment | $ 3,000,000 | ||
Estimated useful lives, description | Estimated useful lives ranging from 4 to 15 years. | ||
Accrued expenses | $ 800,000 | ||
CareSpeak acquisition [Member] | |||
Acquisition (Textual) | |||
Total purchase price | 8,493,451 | ||
Total contingent payment | 3,000,000 | ||
RMDY acquisition [Member] | |||
Acquisition (Textual) | |||
Total purchase price | $ 17,822,162 | 17,822,162 | |
Acquisition costs | $ 799,623 | ||
Total contingent payment | 30,000,000 | ||
RMDY acquisition [Member] | Minimum [Member] | |||
Acquisition (Textual) | |||
Total contingent payment | $ 1,000,000 |
Prepaid Expenses (Details)
Prepaid Expenses (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Prepaid Expenses [Abstract] | ||
Insurance | $ 69,250 | $ 43,764 |
Prepaid revenue share payments | 201,114 | |
EHR access fees | 313,121 | 302,527 |
Other | 287,558 | 14,335 |
Total prepaid expenses | $ 871,043 | $ 360,146 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Subtotal | $ 324,930 | $ 254,032 |
Less accumulated depreciation | 148,916 | 104,702 |
Property and equipment, net | 176,014 | 149,330 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Subtotal | 137,763 | 94,384 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Subtotal | $ 187,167 | $ 159,648 |
Property and Equipment (Detai_2
Property and Equipment (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Property and Equipment (Textual) | ||
Depreciation expense | $ 80,206 | $ 58,423 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, Gross Carrying Amount | $ 17,071,470 | $ 7,295,470 |
Accumulated Amortization | 3,131,328 | 2,036,403 |
Intangible assets , Net | 2,550,587 | 2,766,944 |
Technology Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, Gross Carrying Amount | 8,140,013 | 1,515,013 |
Accumulated Amortization | 1,901,560 | 1,473,890 |
Intangible assets , Net | $ 6,238,453 | 104,820 |
Weighted Average Life Remaining | 8 years | |
Patent rights [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, Gross Carrying Amount | $ 3,329,457 | 3,329,457 |
Accumulated Amortization | 778,870 | 562,513 |
Intangible assets , Net | $ 2,550,587 | $ 2,766,944 |
Weighted Average Life Remaining | 11 years 8 months 12 days | 12 years 8 months 12 days |
Tradename [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, Gross Carrying Amount | $ 3,586,000 | $ 982,000 |
Accumulated Amortization | 59,767 | |
Intangible assets , Net | $ 3,526,233 | $ 982,000 |
Weighted Average Life Remaining | 14 years 6 months | |
Weighted Average Life Remaining, Indefinite | Indefinite | |
Non-compete agreements [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, Gross Carrying Amount | $ 1,093,000 | $ 977,000 |
Accumulated Amortization | 309,635 | 50,885 |
Intangible assets , Net | $ 783,365 | $ 926,115 |
Weighted Average Life Remaining | 2 years 8 months 12 days | 3 years 9 months 18 days |
Customer relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, Gross Carrying Amount | $ 923,000 | $ 492,000 |
Accumulated Amortization | 81,496 | 12,812 |
Intangible assets , Net | $ 841,504 | $ 479,188 |
Weighted Average Life Remaining | 10 years 6 months | 7 years 9 months 18 days |
Other intangible assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, Gross Carrying Amount | $ 5,602,000 | |
Accumulated Amortization | 450,898 | |
Intangible assets , Net | $ 5,151,102 | |
Web-Based Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Life Remaining | 1 year 1 month 6 days |
Intangible Assets (Details 1)
Intangible Assets (Details 1) | 12 Months Ended |
Dec. 31, 2019 | |
Maximum [Member] | Technology Assets [Member] | |
Intangibles amortized estimated useful lives | 10 years |
Minimum [Member] | Technology Assets [Member] | |
Intangibles amortized estimated useful lives | 3 years |
Patents [Member] | Maximum [Member] | |
Intangibles amortized estimated useful lives | 15 years |
Patents [Member] | Minimum [Member] | |
Intangibles amortized estimated useful lives | 17 years |
Tradename [Member] | |
Intangibles amortized estimated useful lives | 15 years |
Non-compete agreements [Member] | Maximum [Member] | |
Intangibles amortized estimated useful lives | 4 years |
Non-compete agreements [Member] | Minimum [Member] | |
Intangibles amortized estimated useful lives | 2 years |
Customer relationships [Member] | Maximum [Member] | |
Intangibles amortized estimated useful lives | 15 years |
Customer relationships [Member] | Minimum [Member] | |
Intangibles amortized estimated useful lives | 8 years |
Intangible Assets (Details 2)
Intangible Assets (Details 2) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Year ended December 31, | ||
2020 | $ 1,811,400 | |
2021 | 1,794,795 | |
2022 | 1,391,965 | |
2023 | 990,267 | |
2024 | 990,267 | |
Thereafter | 6,961,448 | |
Total | $ 2,550,587 | $ 2,766,944 |
Intangible Assets (Details Text
Intangible Assets (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Intangible Assets (Textual) | ||
Amortization expense | $ 1,094,924 | $ 258,079 |
Acquired software cost | $ 1,500,000 |
Deferred Revenue (Details)
Deferred Revenue (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred Revenue (Textual) | ||
Deferred revenue | $ 580,014 | $ 610,625 |
Related Party Transactions (Det
Related Party Transactions (Details) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Total billings to WPP Agencies [Member] | |
Related Party Transaction [Line Items] | |
Related party transactions | $ 6,217,735 |
Revenue recognized from WPP Agencies [Member] | |
Related Party Transaction [Line Items] | |
Related party transactions | 6,527,051 |
Accounts receivable [Member] | |
Related Party Transaction [Line Items] | |
Related party transactions | $ 2,051,532 |
Related Party Transactions (D_2
Related Party Transactions (Details Textual) - Chief Executive Officer [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2010 | Dec. 31, 2015 | |
Related Party Transactions (Textual) | ||
Common stock options | $ 930,000 | |
Percentage of ownership by WPP | 20.00% |
Contingent Purchase Price (Deta
Contingent Purchase Price (Details) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Total | $ 6,720,000 |
Current [Member] | |
Total | 1,500,000 |
Long-Term [Member] | |
Total | 5,220,000 |
CareSpeak Communications, Inc. [Member] | |
Total | 3,000,000 |
CareSpeak Communications, Inc. [Member] | Current [Member] | |
Total | 1,500,000 |
CareSpeak Communications, Inc. [Member] | Long-Term [Member] | |
Total | 1,500,000 |
RMDY Health, Inc. [Member] | |
Total | 3,720,000 |
RMDY Health, Inc. [Member] | Current [Member] | |
Total | |
RMDY Health, Inc. [Member] | Long-Term [Member] | |
Total | $ 3,720,000 |
Contingent Purchase Price (De_2
Contingent Purchase Price (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Contingent Purchase Price (Textual) | ||
Contingent purchase price payable | $ 5,220,000 | $ 2,365,000 |
Risk free rate of return | 1.40% | |
Fair value of term | 2 years | |
Fair value of volatility | 40.00% | |
Total contingent payment | $ 300,000 | |
Minimum payment | 1,000,000 | |
Fair value of the contingent payment | $ 3,720,000 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) | May 14, 2018 | Dec. 31, 2019 | Dec. 31, 2018 |
Equity (Textual) | |||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | |
Preferred Stock, par value | $ 0.001 | $ 0.001 | |
Preferred stock, shares issued | |||
Preferred stock, shares outstanding | |||
Shares of common stock issued, value | $ 21,303,826 | $ 8,164,474 | |
Payments to advisors and legal fees | 1,696,749 | 835,526 | |
Net proceeds issuance of common stock | 21,303,826 | 8,164,474 | |
Common stock value issued for services | 447,393 | 656,934 | |
Common stock acquisition, value | 5,107,793 | $ 500,000 | |
Issued shares of common stock in connection with cashless exercise | 251,046 | ||
Warrant to purchase shares | 348,194 | ||
Stock-based compensation | $ 2,260,298 | $ 2,520,845 | |
Issuance of common stock exercise | 246,448 | 165,169 | |
Issuance of common stock exercise value | $ 877,702 | $ 521,270 | |
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. | ||
Retained Earnings amount | 3,229 | ||
Shares issued | 908 | ||
Restricted stock awards value | $ 653,000 | $ 546,007 | |
Restricted stock awards shares | 50,000 | 130,001 | |
Common stock, par value | $ 0.001 | $ 0.001 | |
Common stock, shares authorized | 166,666,667 | 166,666,667 | |
Common stock, shares issued | 14,600,579 | 12,038,618 | |
Common stock, shares outstanding | 14,600,579 | 12,038,618 | |
Maximum [Member] | |||
Equity (Textual) | |||
Common stock, shares authorized | 166,666,667 | ||
Minimum [Member] | |||
Equity (Textual) | |||
Common stock, shares authorized | 500,000,000 | ||
Private Transaction [Member] | |||
Equity (Textual) | |||
Shares of common stock issued | 1,769,275 | 1,666,669 | |
Gross proceeds of common stock amount | $ 23,000,575 | $ 9,000,000 | |
Subsidiary of WPP [Member] | |||
Equity (Textual) | |||
Shares of common stock issued | 100,000 | ||
Shares of common stock issued, value | $ 447,000 | ||
RMDY Health, Inc. [Member] | |||
Equity (Textual) | |||
Shares of common stock issued | 382,893 | 30,638 | |
Shares of common stock issued, value | $ 5,107,793 | $ 500,000 | |
Directors [Member] | |||
Equity (Textual) | |||
Shares of common stock issued, value | $ 447,393 | $ 428,884 | |
Compensation plan issuance of shares | 33,344 | 36,494 | |
Investor [Member] | |||
Equity (Textual) | |||
Common stock value issued for services | $ 228,050 | ||
Common stock shares issued for services, shares | 15,000 |
Stock Compensation (Details)
Stock Compensation (Details) - Stock Options [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Number of Options | ||
Begining balance, Outstanding | 1,554,700 | 1,368,772 |
Granted | 410,134 | 401,099 |
Exercised | (251,063) | (165,169) |
Expired | (89,550) | (50,002) |
Ending balance, Outstanding | 1,624,221 | 1,554,700 |
Exercisable | 1,143,637 | |
Weighted average exercise price | ||
Beginning balance, Outstanding | $ 4.63 | $ 3.12 |
Granted | 12.28 | 9.27 |
Exercised | 3.73 | 3.16 |
Expired | 12.55 | 5.48 |
Ending balance, Outstanding | 6.27 | $ 4.63 |
Exercisable | $ 4.39 | |
Weighted average remaining contractual life (years) | 2 years 7 months 6 days | 3 years |
Weighted average remaining contractual life (years) | 1 year 10 months 25 days | |
Outstanding, Aggregate intrinsic value | $ 7,925,643 | |
Exercisable, Aggregate intrinsic value | $ 7,197,053 |
Stock Compensation (Details 1)
Stock Compensation (Details 1) | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 1,624,221 |
Exercise Price | $ / shares | $ 6.27 |
Options One [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 175,799 |
Exercise Price | $ / shares | $ 2.46 |
Expiration Date | Mar. 31, 2022 |
Options Two [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 41,668 |
Exercise Price | $ / shares | $ 3.15 |
Expiration Date | Jun. 24, 2020 |
Options Three [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 210,520 |
Exercise Price | $ / shares | $ 3.15 |
Expiration Date | Jul. 27, 2022 |
Options Four [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 470,000 |
Exercise Price | $ / shares | $ 3.21 |
Expiration Date | Feb. 22, 2021 |
Options Five [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 105,836 |
Exercise Price | $ / shares | $ 3.45 |
Expiration Date | Jul. 28, 2021 |
Options Six [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 100,006 |
Exercise Price | $ / shares | $ 4.2 |
Expiration Date | Feb. 1, 2023 |
Options Seven [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 8,336 |
Exercise Price | $ / shares | $ 4.62 |
Expiration Date | Mar. 31, 2023 |
Options Eight [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 8,336 |
Exercise Price | $ / shares | $ 4.71 |
Expiration Date | Dec. 31, 2022 |
Options Nine [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 8,000 |
Exercise Price | $ / shares | $ 9.76 |
Expiration Date | Dec. 2, 2024 |
Options Ten [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 139,000 |
Exercise Price | $ / shares | $ 10.18 |
Expiration Date | Nov. 24, 2024 |
Options Eleven [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 8,336 |
Exercise Price | $ / shares | $ 10.4 |
Expiration Date | Jun. 30, 2023 |
Options Twelve [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 11,800 |
Exercise Price | $ / shares | $ 12.49 |
Expiration Date | Aug. 13, 2023 |
Options Thirteen [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 6,000 |
Exercise Price | $ / shares | $ 12.51 |
Expiration Date | Aug. 20, 2023 |
Options Fourteen [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 10,000 |
Exercise Price | $ / shares | $ 12.7 |
Expiration Date | Aug. 22, 2023 |
Options Fiveteen [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 15,000 |
Exercise Price | $ / shares | $ 12.73 |
Expiration Date | Sep. 4, 2023 |
Options Sixteen [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 14,084 |
Exercise Price | $ / shares | $ 12.77 |
Expiration Date | Apr. 8, 2024 |
Options Seventeen [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 30,500 |
Exercise Price | $ / shares | $ 13.06 |
Expiration Date | Feb. 27, 2024 |
Options Eighteen [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 16,000 |
Exercise Price | $ / shares | $ 13.31 |
Expiration Date | Jun. 10, 2024 |
Options Nineteen [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 40,000 |
Exercise Price | $ / shares | $ 13.34 |
Expiration Date | Oct. 4, 2024 |
Options Twenty [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 29,000 |
Exercise Price | $ / shares | $ 14.48 |
Expiration Date | Sep. 30, 2024 |
Options Twenty One [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 16,000 |
Exercise Price | $ / shares | $ 15.1 |
Expiration Date | May 23, 2024 |
Options Twenty Two [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 12,000 |
Exercise Price | $ / shares | $ 15.32 |
Expiration Date | Jul. 15, 2024 |
Options Twenty Three [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 125,000 |
Exercise Price | $ / shares | $ 15.4 |
Expiration Date | Oct. 16, 2023 |
Options Twenty Four [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 16,000 |
Exercise Price | $ / shares | $ 15.51 |
Expiration Date | May 30, 2024 |
Options Twenty Five [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options | shares | 7,000 |
Exercise Price | $ / shares | $ 16.24 |
Expiration Date | Oct. 22, 2023 |
Stock Compensation (Details Tex
Stock Compensation (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Stock Options (Textual) | ||
Restricted shares | 50,000 | 130,001 |
Restricted stock, value | $ 653,000 | $ 546,007 |
Restricted stock vesting period | 5 years | |
Expense remaining to be recognized related to options | $ 1,612,382 | |
Stock options are exercisable term | 1 year 9 months 18 days | |
Stock Compensation Plan [Member] | ||
Stock Options (Textual) | ||
Shares reserved for issuance | 500,000 | |
Share-based compensation plan, description | The Plan was amended several times since then to eventually increase the authorized shares to 2,500,000 as of December 31, 2019. | |
Options outstanding | 1,624,221 | |
Stock compensation remaining shares available to grant | 236,614 | |
Stock Options [Member] | ||
Stock Options (Textual) | ||
Compensation cost | $ 1,687,745 | $ 1,317,904 |
Weighted average contractual life | 1 year 10 months 25 days | |
Options exercisable | 1,143,637 | |
Restricted Stock [Member] | ||
Stock Options (Textual) | ||
Restricted shares | 90,000 | |
Restricted stock, value | $ 938,700 | |
Restricted stock vesting period | 4 years 3 months 19 days | |
Stock compensation recognized expense | $ 125,160 | |
Compensation cost | $ 813,540 |
Warrants (Details)
Warrants (Details) - Warrant [Member] | 12 Months Ended |
Dec. 31, 2018$ / sharesshares | |
Number of Shares Underlying Warrants | |
Beginning balance | shares | 348,194 |
Exercised | shares | (348,194) |
Ending balance | shares | |
Weighted average exercise price | |
Beginning Balance | $ / shares | $ 3.33 |
Exercised | $ / shares | 3.33 |
Ending Balance | $ / shares |
Leases (Details)
Leases (Details) | 12 Months Ended | |
Dec. 31, 2019USD ($) | ||
Leases [Abstract] | ||
Operating lease cost | $ 132,020 | |
Short-term lease cost | 84,935 | [1] |
Total lease cost | $ 216,955 | |
[1] | Short-term lease cost includes any lease with a term of less than 12 months. |
Leases (Details 1)
Leases (Details 1) | Dec. 31, 2019USD ($) |
Leases [Abstract] | |
2020 | $ 138,019 |
2021 | 140,367 |
2022 | 102,367 |
2023 | 99,209 |
2024 | 80,375 |
Thereafter | 70,224 |
Total | 630,561 |
Less: present value discount | 66,377 |
Total lease liabilities | $ 564,184 |
Leases (Details Textual)
Leases (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Jan. 02, 2019 | Dec. 31, 2018 | |
Leases (Textual) | |||
Operating leases expires period | Nov. 30, 2022 | ||
Operating leases description | We also have a lease on office space in Cranbury, New Jersey, expiring in 2022 with monthly payments ranging from $3,008 to $3,158, as well as a lease of approximately $1,883 per month in Zagreb, Croatia expiring in 2022. | ||
Operating lease, right of use asset | $ 559,863 | $ 462,000 | |
Operating lease related liabilities | $ 465,000 | ||
Weighted average remaining lease term | 5 years 1 month 6 days | ||
Weighted average discount rate | 4.50% | ||
Measurement of lease liabilities | $ 106,564 | ||
Payments on lease obligations | 132,867 | ||
Amortization right of use assets | 107,656 | ||
Minimum [Member] | |||
Leases (Textual) | |||
Operating leases rent payable | 6,384 | ||
Maximum [Member] | |||
Leases (Textual) | |||
Operating leases rent payable | $ 6,688 |
Major Customers and Vendors (De
Major Customers and Vendors (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue, Major Customer [Line Items] | ||
Revenue | $ 24,598,274 | $ 21,206,363 |
Customer A [Member] | ||
Revenue, Major Customer [Line Items] | ||
Revenue | $ 3,883,589 | $ 1,678,669 |
Revenue percentage | 15.80% | 7.90% |
Customer B [Member] | ||
Revenue, Major Customer [Line Items] | ||
Revenue | $ 2,801,748 | $ 930,682 |
Revenue percentage | 11.40% | 4.40% |
Customer C [Member] | ||
Revenue, Major Customer [Line Items] | ||
Revenue | $ 2,533,766 | $ 2,122,657 |
Revenue percentage | 10.30% | 10.00% |
Customer D [Member] | ||
Revenue, Major Customer [Line Items] | ||
Revenue | $ 1,349,214 | $ 2,547,113 |
Revenue percentage | 5.50% | 12.00% |
Customer E [Member] | ||
Revenue, Major Customer [Line Items] | ||
Revenue | $ 2,280,873 | |
Revenue percentage | 0.00% | 10.80% |
Partner A [Member] | ||
Revenue, Major Customer [Line Items] | ||
Revenue | $ 1,315,706 | $ 6,841,386 |
Revenue percentage | 5.30% | 32.30% |
Partner B [Member] | ||
Revenue, Major Customer [Line Items] | ||
Revenue | $ 9,210,347 | $ 5,350,393 |
Revenue percentage | 37.40% | 25.20% |
Partner C [Member] | ||
Revenue, Major Customer [Line Items] | ||
Revenue | $ 4,051,217 | $ 2,584,103 |
Revenue percentage | 16.50% | 12.20% |
Partner D [Member] | ||
Revenue, Major Customer [Line Items] | ||
Revenue | $ 1,007,573 | $ 2,159,356 |
Revenue percentage | 4.10% | 10.20% |
Major Customers and Vendors (_2
Major Customers and Vendors (Details Textual) - Customers | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Major Customers and Vendors (Textual) | ||
No of customers | 3 | |
Revenue [Member] | Four Key Partners [Member] | ||
Major Customers and Vendors (Textual) | ||
Concentration risk percentage total | 10.00% | 10.00% |
Accounts Receivable [Member] | ||
Major Customers and Vendors (Textual) | ||
Concentration risk percentage total | 10.00% | |
Customer One [Member] | Revenue [Member] | ||
Major Customers and Vendors (Textual) | ||
Concentration risk percentage total | 10.00% | 10.00% |
Customer One [Member] | Accounts Receivable [Member] | ||
Major Customers and Vendors (Textual) | ||
Concentration risk percentage total | 17.80% | |
Other Customer [Member] | Revenue [Member] | ||
Major Customers and Vendors (Textual) | ||
Concentration risk percentage total | 10.00% | |
Customer Two [Member] | Accounts Receivable [Member] | ||
Major Customers and Vendors (Textual) | ||
Concentration risk percentage total | 15.40% | |
Customer Three [Member] | ||
Major Customers and Vendors (Textual) | ||
Concentration risk percentage total | 15.80% | 7.90% |
Customer Three [Member] | Accounts Receivable [Member] | ||
Major Customers and Vendors (Textual) | ||
Concentration risk percentage total | 13.30% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Federal income tax benefit (expense) attributable to: | ||
Current operations | $ 848,000 | $ (48,000) |
Acquisition costs | (143,000) | |
Change in fair value of contingent consideration | (133,000) | |
Other permanent items | 29,000 | (36,000) |
Deferred Adjustment | (913,000) | |
Valuation allowance | 1,209,960 | 84,000 |
Net provision for federal income tax | 897,960 | |
Current tax benefit (expense) - Federal | ||
Deferred tax benefit (expense) - Federal | ||
Adjustment of valuation allowance from business combination | 897,960 | |
Total tax benefit (expense) on income | $ 897,960 |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax asset attributable to: | ||
Net operating loss carryover | $ 3,839,000 | $ 2,290,000 |
Stock compensation | 320,000 | 535,000 |
Intangible Assets | 124,000 | |
Other | 36,000 | 3,000 |
Deferred tax asset | 4,195,000 | 2,952,000 |
Deferred tax liabilities attributable to: | ||
Fixed assets | (13,000) | (5,000) |
Intangibles | (2,438,000) | |
Other | (16,000) | (9,000) |
Valuation allowance | (1,728,000) | (2,938,000) |
Deferred tax liability | (4,195,000) | (2,952,000) |
Net deferred tax asset |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Taxes (Textual) | ||
Operating loss carryforwards | $ 18,300,000 | $ 14,300,000 |
Operating loss expire, description | Expire from 2020 through 2037, and post-2017 losses in the amount of approximately $4 million that never expire. | |
Effective rate of tax expected | 21.00% | 21.00% |
Commitments and Contingent Li_2
Commitments and Contingent Liabilities (Details) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Commitments and Contingent Liabilities (Textual) | |
Revenue share contracts, percentage | 10.00% |
Commitments for future minimum payments | $ 13,500,000 |
Minimum payments, description | Minimum payments are due in 2020, 2021, and 2022, in the amounts of $6.5 million, $5.5 million, and $2.0 million, respectively. |
Retirement Plan (Details)
Retirement Plan (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Retirement Plan (Textual) | ||
Defined benefit plan, description | The terms of the plan, the Company matches 100% of the first 3% of payroll contributed by the employee and 50% of the next 2% of payroll contributed by the employee to a maximum of 4% of an employee's payroll. | |
Defined contribution plan, administrative expense | $ 126,557 | $ 172,107 |
Subsequent Events (Details)
Subsequent Events (Details) - shares | 1 Months Ended | ||
Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Subsequent Events (Textual) | |||
Shares Issued | 14,600,579 | 12,038,618 | |
Subsequent Event [Member] | |||
Subsequent Events (Textual) | |||
Options to purchase, exercise price | 112,151 | ||
Shares Issued | 35,032 | ||
Subsequent Event [Member] | Board of Directors [Member] | |||
Subsequent Events (Textual) | |||
Number of shares authorized increased | 3,000,000 | ||
Options to purchase of common stock | 33,000 | ||
Options to new employees | 38,000 | ||
Existing options that previously vested, description | The Company granted 84,746 shares of restricted common stock and options to purchase 233,049 shares of common stock to officers that vest over the balance of 2020. |