Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Nov. 13, 2013 | |
Document And Entity Information | ' | ' |
Entity Registrant Name | 'OptimizeRx Corp | ' |
Entity Central Index Key | '0001448431 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-13 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Is Entity a Well-known Seasoned Issuer? | 'No | ' |
Is Entity a Voluntary Filer? | 'No | ' |
Is Entity's Reporting Status Current? | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 14,503,496 |
Document Fiscal Period Focus | 'Q3 | ' |
Document Fiscal Year Focus | '2013 | ' |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Current Assets | ' | ' |
Cash and cash equivalents | $486,692 | $284,263 |
Accounts receivable | 1,148,907 | 616,798 |
Prepaid expenses | 26,336 | 68,158 |
Total Current Assets | 1,661,935 | 969,219 |
Property and equipment, net | 16,464 | 20,685 |
Other Assets | ' | ' |
Patent rights, net | 788,890 | 793,236 |
Web development costs, net | 351,778 | 387,215 |
Security deposit | 5,049 | 5,049 |
Total Other Assets | 1,145,717 | 1,185,500 |
TOTAL ASSETS | 2,824,116 | 2,175,404 |
Current Liabilities | ' | ' |
Accounts payable - trade | 174,453 | 54,693 |
Accounts payable - related party | 570,000 | 570,000 |
Accrued expenses | 0 | 6,000 |
Deferred revenue | 13,272 | 49,252 |
Total Liabilities | 757,725 | 679,945 |
Stockholders Equity | ' | ' |
Common stock, $.001 par value, 500,000,000 shares authorized, 14,752,496 and 14,232,496 shares issued and outstanding | 14,752 | 14,232 |
Preferred stock, $.001 par value, 10,000,000 shares authorized, 65 shares issued and outstanding | 0 | 0 |
Stock warrants | 18,316,826 | 20,058,051 |
Additional paid-in-capital | 8,449,271 | 6,164,666 |
Deferred stock compensation | -233,077 | 0 |
Accumulated deficit | -24,481,381 | -24,741,490 |
Total Stockholders Equity | 2,066,391 | 1,495,459 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $2,824,116 | $2,175,404 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Statement of Financial Position [Abstract] | ' | ' |
Common Stock, Par Value | $0.00 | $0.00 |
Common Stock, Shares Authorized | 500,000,000 | 500,000,000 |
Common Stock, Issued | 14,752,496 | 14,232,496 |
Preferred Stock, Par Value | $0.00 | $0.00 |
Preferred Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Preferred Stock, Issued | 65 | 65 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
REVENUE | ' | ' | ' | ' |
Sales | $1,373,029 | $453,154 | $3,146,406 | $1,297,980 |
TOTAL REVENUE | 1,373,029 | 453,154 | 3,146,406 | 1,297,980 |
EXPENSES | ' | ' | ' | ' |
Operating expenses (See Note 17) | 1,362,335 | 559,305 | 2,886,473 | 1,781,257 |
TOTAL EXPENSES | 1,362,335 | 559,305 | 2,886,473 | 1,781,257 |
OPERATING INCOME (LOSS) | 10,694 | -106,151 | 259,933 | -483,277 |
OTHER INCOME (EXPENSE) | ' | ' | ' | ' |
Interest income | 82 | 77 | 176 | 408 |
Interest expense | 0 | -100 | 0 | -100 |
TOTAL OTHER INCOME (EXPENSE) | 82 | -23 | 176 | 308 |
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES | 10,776 | -106,174 | 260,109 | -482,969 |
PROVISION FOR INCOME TAXES | 0 | 0 | 0 | 0 |
NET INCOME (LOSS) | $10,776 | ($106,174) | $260,109 | ($482,969) |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC | 14,270,811 | 14,227,713 | 14,259,675 | 14,201,373 |
NET INCOME (LOSS) PER SHARE: BASIC | $0 | ($0.01) | $0.02 | ($0.03) |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: DILUTED | 34,086,091 | 14,227,713 | 34,074,956 | 14,201,373 |
NET INCOME (LOSS) PER SHARE: DILUTED | $0 | ($0.01) | $0.01 | ($0.03) |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ' | ' |
Net income (loss) for the period | $260,109 | ($482,969) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ' | ' |
Depreciation and amortization | 144,562 | 140,087 |
Stock-based compensation | 310,823 | 227,922 |
Changes in: | ' | ' |
Accounts receivable | -532,109 | -171,779 |
Prepaid expenses | 41,822 | 74,140 |
Accounts payable | 119,760 | -328,236 |
Accrued expenses | -6,000 | -66,000 |
Deferred revenue | -35,980 | -18,831 |
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | 302,987 | -625,666 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ' | ' |
Purchases of property and equipment | 0 | -2,230 |
Patent rights | -38,278 | 0 |
Web development costs | -62,280 | -48,640 |
NET CASH USED IN INVESTING ACTIVITIES | -100,558 | -50,870 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 202,429 | -676,536 |
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 284,263 | 959,166 |
CASH AND CASH EQUIVALENTS - END OF PERIOD | 486,692 | 282,630 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ' | ' |
Cash paid for interest | 0 | 0 |
Cash paid for income taxes | 0 | 0 |
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES: | ' | ' |
Common stock issued in officer settlement upon severance | $505,000 | $0 |
NATURE_OF_BUSINESS
NATURE OF BUSINESS | 9 Months Ended |
Sep. 30, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
NATURE OF BUSINESS | ' |
Optimizer Systems, LLC was formed in the State of Michigan on January 31, 2006. It then became a corporation in the State of Michigan on October 22, 2007 and changed its name to OptimizeRx Corporation. On April 14, 2008, RFID, Ltd., a Colorado corporation, consummated a reverse merger by entering into a share exchange agreement with the stockholders of OptimizeRx Corporation, pursuant to which the stockholders of OptimizeRx Corporation exchanged all of the issued and outstanding capital stock of OptimizeRx Corporation for 1,256,958 shares of common stock of RFID, Ltd., representing 100% of the outstanding capital stock of RFID, Ltd. As of April 30, 2008, RFID’s officers and directors resigned their positions and RFID changed its business to OptimizeRx’s business. On April 15, 2008, RFID, Ltd.’s corporate name was changed to OptimizeRx Corporation. On September 4, 2008, a migratory merger was completed, thereby changing the state of incorporation from Colorado to Nevada, resulting in the current corporate structure, in which OptimizeRx Corporation, a Nevada corporation, is the parent corporation, and OptimizeRx Corporation, a Michigan corporation, is a wholly-owned subsidiary (together, "OptimizeRx" and "the Company"). | |
The wholly-owned subsidiary, OptimizeRx Corporation, is a technology solutions company targeting the health care industry. Their objective is to bring better access to better care through connecting patients, physicians and pharmaceutical manufacturers through technology. Once defined as a marketing and advertising company through its consumer website, OptimizeRx is maturing as a technology solutions provider as it launched its direct to physician solution, SampleMD. SampleMD allows physicians to search, print and send available sample trial vouchers and/or co-pay coupons on behalf of their patients. The SampleMD solution can either sit on the doctor’s desktop or can be integrated into the ePrescribing or Electronic Medical Records applications. OptimizeRx solutions provide pharmaceutical manufacturers either a direct to consumer and/or direct to physician channels for communicating and promoting their products. It provides health care providers a means to provide sampling and coupons without having to physically store samples on site, and it provides better access and affordability to the patients. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | ' |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' |
Basis of Presentation | |
The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission (“SEC”), and should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s Form 10-K filed with the SEC as of and for the year ended December 31, 2012. In the opinion of management, all adjustments necessary for the financial statements to be not misleading for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. | |
Accounting Basis | |
The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“GAAP” accounting). The Company has adopted a December 31 fiscal year end. | |
Principles of Consolidation | |
The financial statements reflect the consolidated results of OptimizeRx Corporation (a Nevada corporation) and its wholly owned subsidiary OptimizeRx Corporation (a Michigan corporation). All material inter-company transactions have been eliminated in the consolidation. | |
Cash and Cash Equivalents | |
For purposes of the accompanying financial statements, the Company considers all highly liquid instruments with an initial maturity of three months or less to be cash equivalents. | |
Fair Value of Financial Instruments | |
The fair value of cash, accounts receivable, prepaid expenses, patent rights, web development costs, accounts payable, accounts payable – related party, accrued expenses and deferred revenue approximates the carrying amount of these financial instruments due to their short-term nature. The fair value of long-term debt, which approximates its carrying value, is based on current rates at which the Company could borrow funds with similar remaining maturities. | |
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. Bad debt expense was $0 for the nine months ended September 30, 2013 and 2012, respectively. The allowance for doubtful accounts was $0 as of September 30, 2013 and December 31, 2012, respectively. | |
Property and Equipment | |
The capital assets are being depreciated over their estimated useful lives, three to seven years using the straight-line method of depreciation for book purposes. | |
Revenue Recognition | |
All revenue is recognized when it is earned. Revenues are generated either through the Company’s website activities, in which we earn revenue from advertising and lead generation activities, or from our SampleMD activities, which include offering setup within the systems and our offers, coupons, and vouchers that enable our customers to save money on medical products and services. The Company’s processes are monitored by third parties who collect revenues from clients on a per activity basis and report and forward the revenue to the Company’s account. | |
Research and Development | |
The Company’s key members are part of a continual research development team and monitor new technologies, trends, services and partnerships that can provide the Company with additional services, value to healthcare and pharmaceutical industries and to the patients it serves. | |
The Company seeks to educate team members through understanding of all market dynamics that have the potential to affect the business both short term and longer term. The primary goal is to help patients better afford and access the medicines their doctor prescribes, as well as other healthcare products and services they need. Based on this, the Company continually seeks better ways to meet this mission through technology, better user experiences and new ways to engage industries to provide new support for patients needing their products. The Company is always seeking new services and solutions to offer. At this time, the three current platforms provide robust opportunities and growth during the next five years. | |
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 bases 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. | |
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. | |
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 depreciable lives of such assets and the allowance for doubtful accounts receivable. Actual results could differ from these estimates. | |
Earnings Per Common and Common Equivalent Share | |
The computation of basic earnings per common share is computed using the weighted average number of common shares outstanding during the year. The computation of diluted earnings per common share is based on the weighted average number of shares outstanding during the year plus common stock equivalents which would arise from the exercise of warrants outstanding using the treasury stock method and the average market price per share during the year. Options, warrants and convertible preferred stock which are common stock equivalents are included in the per share calculation for the three and nine months ended September 30, 2013. They have not been included in the diluted earnings per share calculation for the three and nine months ended September 30, 2012 since their effect is anti-dilutive. | |
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 | |
The Company does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company’s results of operations, financial position or cash flow. |
PREPAID_EXPENSES
PREPAID EXPENSES | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ' | |||||||
PREPAID EXPENSES | ' | |||||||
Prepaid expenses consisted of the following as of September 30, 2013 and December 31, 2012: | ||||||||
2013 | 2012 | |||||||
Insurance | $ | 6,653 | $ | 6,437 | ||||
Rent | 5,049 | 5,049 | ||||||
Consulting | 14,634 | 31,672 | ||||||
Legal | 0 | 25,000 | ||||||
Total prepaid expenses | $ | 26,336 | $ | 68,158 |
PROPERTY_AND_EQUIPMENT
PROPERTY AND EQUIPMENT | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||
PROPERTY AND EQUIPMENT | ' | |||||||
The Company owned equipment recorded at cost which consisted of the following as of September 30, 2013 and December 31, 2012: | ||||||||
2013 | 2012 | |||||||
Computer equipment | $ | 22,360 | $ | 22,360 | ||||
Furniture and fixtures | 11,088 | 11,088 | ||||||
Subtotal | 33,448 | 33,448 | ||||||
Accumulated depreciation | (16,984 | ) | (12,763 | ) | ||||
Property and equipment, net | $ | 16,464 | $ | 20,685 | ||||
Depreciation expense was $1,407 and $1,382 for the three months ended September 30, 2013 and 2012, respectively. Depreciation expense was $4,221 and $4,094 for the nine months ended September 30, 2013 and 2012, respectively. |
WEB_DEVELOPMENT_COSTS
WEB DEVELOPMENT COSTS | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Notes to Financial Statements | ' | |||||||
WEB DEVELOPMENT COSTS | ' | |||||||
The Company has capitalized costs in developing their website and web-based products, which consisted of the following as of September 30, 2013 and December 31, 2012: | ||||||||
2013 | 2012 | |||||||
OptimizeRx web development | $ | 154,133 | $ | 154,133 | ||||
SampleMD web development | 602,517 | 602,517 | ||||||
SampleMD 2.0 | 62,280 | 0 | ||||||
Subtotal, web development costs | 818,930 | 756,650 | ||||||
Accumulated amortization | (408,069 | ) | (310,352 | ) | ||||
Impairment | (59,083 | ) | (59,083 | ) | ||||
Web development costs, net | $ | 351,778 | $ | 387,215 | ||||
Amortization is recorded using the straight-line method over a period of five years. The Company is currently developing an enhanced SampleMD website and has capitalized $62,280. The development is currently in process. It is not completed at September 30, 2013. Accordingly, no amortization has been recorded. The development is expected to be completed in 2014. The Company determined that the original OptimizeRx website was no longer useful so the remaining unamortized balance of $59,083 was impaired as of December 31, 2010. Amortization expense for the web development costs was $32,572 and $31,677 for the three months ended September 30, 2013 and 2012, respectively. Amortization expense for the web development costs was $97,717 and $94,964 for the nine months ended September 30, 2013 and 2012, respectively. |
PATENT_RIGHTS_AND_INTANGIBLE_A
PATENT RIGHTS AND INTANGIBLE ASSETS | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||
PATENT RIGHTS AND INTANGIBLE ASSETS | ' | |||||||
On April 26, 2010, the Company acquired from an officer and shareholder the technical contributions and assignment of all exclusive rights to and for the SampleMD patent currently in process in exchange for 300,000 shares of common stock to be granted at the discretion of the seller in addition to 200,000 stock options valued at $360,000. The shares were valued on the grant date at $570,000 and have been recorded as a payable to the related party. | ||||||||
The Company has capitalized costs in purchasing and defending the SampleMD patent, which consisted of the following as of September 30, 2013 and December 31, 2012: | ||||||||
2013 | 2012 | |||||||
Patent rights and intangible assets | $ | 930,000 | $ | 930,000 | ||||
Patent defense costs | 38,278 | 0 | ||||||
Accumulated amortization | (179,388 | ) | (136,764 | ) | ||||
Patent rights and intangible assets, net | $ | 788,890 | $ | 793,236 | ||||
The Company began amortizing the patent, using the straight-line method over the estimated useful life of 17 years, once it was put into service in July 2010. In 2013, the Company began incurring costs related to defense of the patent. These costs have been capitalized and will be amortized using the straight-line method over the remaining useful life of the original patent. Amortization expense was $14,246 and $13,676 for the three months ended September 30, 2013 and 2012, respectively. Amortization expense was $42,624 and $41,029 for the nine months ended September 30, 2013 and 2012, respectively. |
ACCRUED_EXPENSES
ACCRUED EXPENSES | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Payables and Accruals [Abstract] | ' | |||||||
ACCRUED EXPENSES | ' | |||||||
On January 14, 2013, the Company hired a new CEO. The employment agreement required annual compensation of $175,000 that was to be accrued and deferred until at least January 1, 2014. Additionally, the agreement required the issuance of 2,000,000 options with an exercise price of $1.00 for a term of five years. The options were not exercisable until at least January 1, 2014. On September 20, 2013, the Company entered into a separation agreement with the CEO. As part of the agreement, the accrued compensation was paid through the date of separation and the options were terminated. | ||||||||
Accrued expenses consisted of the following as of September 30, 2013 and December 31, 2012: | ||||||||
2013 | 2012 | |||||||
Accrued compensation | $ | 0 | $ | 0 | ||||
Accrued audit fees | 0 | 6,000 | ||||||
Total accrued expenses | $ | 0 | $ | 6,000 |
DEFERRED_REVENUE
DEFERRED REVENUE | 9 Months Ended |
Sep. 30, 2013 | |
Revenue Recognition [Abstract] | ' |
DEFERRED REVENUE | ' |
The Company has signed several contracts with customers for either the distribution or redemption of coupons. The payments are not taken into revenue until either the coupon is distributed to a patient or the coupon has been redeemed depending on the specific contract. The distributions and redemptions are tracked by the Company’s administrative tool. Additionally, customer setup contracts that have been paid in full are deferred until the Company has completed the obligations of the contacts. Deferred revenue was $13,272 and $49,252 as of September 30, 2013 and December 31, 2012, respectively. |
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2013 | |
Related Party Transactions [Abstract] | ' |
RELATED PARTY TRANSACTIONS | ' |
During the year ended December 31, 2010, the Company acquired from an officer and shareholder the technical contributions and assignment of all exclusive rights to and for the SampleMD patent currently in process in exchange for 300,000 shares of common stock to be granted at the discretion of the seller in addition to 200,000 stock options valued at $360,000. The shares were valued on the grant date at $570,000 and have been recorded as a payable to the related party. |
COMMON_STOCK
COMMON STOCK | 9 Months Ended |
Sep. 30, 2013 | |
Equity [Abstract] | ' |
COMMON STOCK | ' |
OptimizeRx Corporation has 500,000,000 shares of $.001 par value common stock authorized as of September 30, 2013. | |
There were 14,752,496 and 14,232,496 common shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively. | |
On June 1, 2012, the Company entered into a consulting agreement with North Coast Advisors, Inc. for various services. The Company agreed to issue 40,000 shares of common stock as of the date of the contract. However, these shares were not issued until July 12, 2012. The Company also agreed to issue an additional 40,000 shares every six months in alignment with the agreement renewal up to the two years of the agreement. The first 40,000 shares were valued at the Company’s common stock price as of the date of the contract, which was $1.12/share and has been expensed. No additional shares were issued and the agreement was voided and replaced by a new agreement as noted below. | |
On June 1, 2013, the Company entered into a consulting agreement with North Coast Advisors, Inc. for various services. The Company agreed to issue 20,000 shares of common stock as of the date of the contract. The Company also agreed to issue an additional 20,000 shares every six months in alignment with the agreement renewal up to the two years of the agreement. The first 20,000 shares were valued at the Company’s common stock price as of the date of the contract, which was $1.945/share and has been expensed. | |
On September 20, 2013, the Company entered into a separation agreement that includes post-employment consulting services with a former officer. The Company agreed to issue 500,000 shares of common stock, 250,000 shares immediately and 250,000 by January 1, 2014. The first 250,000 shares have been issued and the Company has recognized the entire issuance in the September 30, 2013 shares outstanding. The shares were valued at $505,000 and $233,077 of that amount has been recorded as deferred stock compensation as of September 30, 2013. |
PREFERRED_STOCK
PREFERRED STOCK | 9 Months Ended |
Sep. 30, 2013 | |
Equity [Abstract] | ' |
PREFERRED STOCK | ' |
Series A Preferred | |
During the year ended December 31, 2008, 35 preferred shares were issued for $3,500,000. Issuance costs totaled $515,000 resulting in net proceeds of $2,985,000. The 35 shares are convertible to 3,500,000 shares of common stock and bear a 10% cumulative dividend. In addition, there was a warrant issued to purchase 6,000,000 shares of common stock at an exercise price of $2 for a period of seven years. | |
Series A Preferred Continued | |
The holders of the preferred stock are entitled to semi-annual dividends payable on the stated value of the Series A preferred stock at a rate of 10% per annum, which shall be cumulative, and accrue daily from the issuance date. The dividends may be paid in cash or shares of the Company's common stock at management’s discretion. If after the conversion eligibility date, the market price for the common stock for any ten consecutive trading days in which the stock trades for over $2 per share and trading exceeds 100,000 shares per day, the preferred shareholders can be required to convert their shares to common stock. Each share of Series A preferred stock shall also be convertible at the option of the holder into that number of shares of common stock of the Company at the stated value of such share at a $1 conversion price. | |
The holder may cause this conversion at the time the shares are eligible for resale by the holder. The conversion price is subject to adjustment as hereinafter provided, at any time, or from time to time upon the terms and in the manner hereinafter set forth in the shareholder agreement. There is no conversion expiration date, however, the holder must provide 30 days notice for the registration of the conversion. | |
On May 12, 2010, the Company’s Board declared and issued 236,598 common shares as payment for all cumulative and current semi-annual dividends. On November 16, 2010, the Company’s Board declared and issued 173,922 common shares for its semi-annual dividend payment. On March 25, 2011, the Company’s Board declared and issued 176,768 common shares for its semi-annual dividend payment. On September 21, 2011, the Company's Board declared and issued 156,306 common shares for its semi-annual dividend payment. The Company has undeclared dividends that were due in February and September 2012 totaling $350,000 and undeclared dividends of $350,000 that were due in February and September 2013 for a total undeclared amount of $700,000 as of September 30, 2013. | |
Series B Preferred | |
During the year ended December 31, 2010, 15 preferred shares were issued for $1,500,000. The 15 shares are convertible to 1,000,000 shares of common stock and bear a 10% cumulative dividend. In addition, there was a warrant issued to purchase 3,000,000 shares of common stock at an exercise price of $3 for a period of seven years. | |
The preferred stock was issued for $1,500,000 less associated issuance costs of $350,000 for net proceeds of $1,150,000. Additionally, 3,000,000 common stock warrants were issued with the preferred stock. Based on the fair values of the preferred stock and common stock warrants on the issue date, $341,100 was allocated to preferred stock and $1,158,900 was allocated to the common stock warrants. Equity issuance costs of $350,000 were allocated to the preferred stock. | |
During the quarter ended September 30, 2011, 15 preferred shares were issued to an investor for $1,500,000. The 15 shares are convertible to 1,000,000 shares of common stock and bear a 10% cumulative dividend. In addition, there was a warrant issued to purchase 1,000,000 shares of common stock at an exercise price of $3 for a period of seven years. Based on the fair values of the preferred stock and common stock warrants on the issue date, $855,460 was allocated to preferred stock and $644,540 was allocated to the common stock warrants. See Note 12. | |
Series B Preferred Continued | |
The holders of the preferred stock are entitled to semi-annual dividends payable on the stated value of the Series B preferred stock at a rate of 10% per annum, which shall be cumulative, and accrue daily from the issuance date. The dividends may be paid in cash or shares of the Company's common stock at management’s discretion. If after the conversion eligibility date, the market price for the common stock for any ten consecutive trading days in which the stock trades for over $2 per share and trading exceeds 100,000 shares per day, the preferred shareholders can be required to convert their shares to common stock. Each share of Series B preferred stock shall also be convertible at the option of the holder into that number of shares of common stock of the Company at the stated value of such share at a $1.50 conversion price. | |
The holder may cause this conversion at the time the shares are eligible for resale by the holder. The conversion price is subject to adjustment as hereinafter provided, at any time, or from time to time upon the terms and in the manner hereinafter set forth in the shareholder agreement. On March 25, 2011, the Company’s Board declared and issued 75,758 common shares for its semi-annual dividend payment. On September 21, 2011, the Company's Board declared and issued 66,988 common shares for its semi-annual dividend payment. The Company has undeclared dividends that were due in February and September 2012 totaling $150,000 and undeclared dividends of $150,000 that were due in February and September 2013 for a total undeclared amount of $300,000 as of September 30, 2013. |
STOCK_OPTIONS_AND_WARRANTS
STOCK OPTIONS AND WARRANTS | 9 Months Ended | ||||||||||
Sep. 30, 2013 | |||||||||||
Notes to Financial Statements | ' | ||||||||||
STOCK OPTIONS AND WARRANTS | ' | ||||||||||
The Company accounts for employee stock-based compensation in accordance with the guidance of ASC Topic 718: Compensation - Stock Compensation, which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values. | |||||||||||
The Company follows ASC Topic 505-50, formerly EITF 96-18, “Accounting for Equity Instruments that are Issued to Other than Employees for Acquiring, or in Conjunction with Selling Goods and Services,” for stock options and warrants issued to consultants and other non-employees. In accordance with ASC Topic 505-50, these stock options and warrants issued as compensation for services provided to the Company are accounted for based upon the fair value of the services provided or the estimated fair market value of the option or warrant, whichever can be more clearly determined. 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. | |||||||||||
On May 31, 2011, the Company issued 285,000 stock options to 3 employees at an exercise price of $1.00. The options were valued on the grant date using the Black-Scholes option-pricing model with the following assumptions: dividend yield of 0%, expected volatility of 218%, risk-free interest rate of 1.68% and expected life of 60 months. The total value of the options was $320,585. The options vest over one year. The Company recognized share-based compensation expense of $187,005 during the year ended December 31, 2011. The remaining balance of $133,580 was recognized over the first five months of 2012. | |||||||||||
During the quarter ended December 31, 2011, the Company issued 20,000 stock options to 2 employees at an exercise price of $1.00. The options were valued on the grant date using the Black-Scholes option-pricing model with the following assumptions: dividend yield of 0%, expected volatility of 204-205%, risk-free interest rate of 0.88-0.93% and expected life of 60 months. The total value of the options was $19,270. The options vest over one year. The Company recognized share-based compensation expense of $2,480 during the year ended December 31, 2011 and $14,459 during the nine months ended September 30, 2012. The remaining balance was recognized during the remainder of 2012. | |||||||||||
On November 21, 2011, the Company issued 100,000 stock options to an individual at an exercise price of $0.73. The options were valued on the grant date using the Black-Scholes option-pricing model with the following assumptions: dividend yield of 0%, expected volatility of 205%, risk-free interest rate of 0.92% and expected life of 60 months. The Company recognized expenses of $8,346 during the year ended December 31, 2011 and $75,117 during the nine months ended September 30, 2012. The remaining balance was recognized during the remainder of 2012. | |||||||||||
During the quarter ended March 31, 2012, the Company issued 50,000 stock options to 4 non-employees at an exercise price of $0.89. The options were valued on the grant date using the Black-Scholes option-pricing model with the following assumptions: dividend yield of 0%, expected volatility of 198%, risk-free interest rate of 0.65% and expected life of 48 months. The total value of the options was $35,091. The options vest over 4 months. The Company recognized share-based compensation expense of $35,091 during the six months ended June 30, 2012. | |||||||||||
During the quarter ended December 31, 2012, the Company issued 25,000 stock options to a non-employee at an exercise price of $1.58. The options were valued on the grant date using the Black-Scholes option-pricing model with the following assumptions: dividend yield of 0%, expected volatility of 200%, risk-free interest rate of 0.67% and expected life of 60 months. The total value of the options was $40,007. The options vest over 1 year. The Company recognized share-based compensation expense of $8,335 during the three months ended December 31, 2012 and $30,006 during the nine months ended September 30, 2013. The remaining balance will be recognized over the remainder of 2013. | |||||||||||
The Company had the following options outstanding as of September 30, 2013: | |||||||||||
Number of Options | Weighted average | ||||||||||
exercise price | |||||||||||
Outstanding, January 1, 2012 | 405,000 | $ | 1.01 | ||||||||
Granted - 2012 | 75,000 | 1.17 | |||||||||
Exercised - 2012 | 0 | 0 | |||||||||
Expired - 2012 | (455,000 | ) | (.98 | ) | |||||||
Balance, December 31, 2012 | 25,000 | 1.58 | |||||||||
Granted - 2013 | 0 | 0 | |||||||||
Exercised - 2013 | 0 | 0 | |||||||||
Expired - 2013 | 0 | 0 | |||||||||
Balance, September 30, 2013 | 25,000 | $ | 1.58 | ||||||||
The Company had the following warrants outstanding as of September 30, 2013: | |||||||||||
Number of Warrants | Weighted average exercise price | ||||||||||
Outstanding, January 1, 2012 | 14,344,434 | $ | 2.41 | ||||||||
Granted - 2012 | 0 | 0 | |||||||||
Exercised - 2012 | 0 | 0 | |||||||||
Expired - 2012 | 0 | 0 | |||||||||
Balance, December 31, 2012 | 14,344,434 | 2.41 | |||||||||
Granted - 2013 | 0 | 0 | |||||||||
Exercised - 2013 | 0 | 0 | |||||||||
Expired - 2013 | (672,000 | ) | (2.59 | ) | |||||||
Balance, September 30, 2013 | 13,672,434 | $ | 2.44 |
OPERATING_LEASES
OPERATING LEASES | 9 Months Ended | ||||||
Sep. 30, 2013 | |||||||
Leases [Abstract] | ' | ||||||
OPERATING LEASES | ' | ||||||
The Company signed a lease for new office space on December 1, 2011 at an approximate rent of $5,000 per month. The new offices are in Rochester, Michigan. The lease is for three years with an option to renew for an additional two years at approximately $5,200 per month with six months advance notice to exercise the option. Minimum annual rent is as follows for the initial term of the lease: | |||||||
Year ended December 31, 2013 | $ | 60,591 | |||||
2014 | 55,542 | ||||||
2015 | 0 | ||||||
Total lease commitment | $ | 116,133 |
MAJOR_CUSTOMERS
MAJOR CUSTOMERS | 9 Months Ended |
Sep. 30, 2013 | |
Notes to Financial Statements | ' |
MAJOR CUSTOMERS | ' |
The Company had three major customers that accounted for 68% and two major customers that accounted for 50% of the Company’s revenues for the nine months ended September 30, 2013 and 2012, respectively. The Company expects to continue to maintain these relationships with the customers. |
INCOME_TAXES
INCOME TAXES | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Income Tax Disclosure [Abstract] | ' | |||||||
INCOME TAXES | ' | |||||||
For the nine months ended September 30, 2013, the Company incurred net income of approximately $260,000 but has no tax liability. The Company began operations in 2007 and has previous net operating loss carry-forwards of approximately $13,843,000 through December 31, 2012. The cumulative loss of approximately $13,583,000 will be carried forward and can be used through the year 2033 to offset future taxable income. 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 nine months ended September 30, 2013 and 2012: | ||||||||
2013 | 2012 | |||||||
Federal income tax (expense) benefit attributable to: | ||||||||
Current operations | $ | (88,000 | ) | $ | 102,000 | |||
Valuation allowance | 88,000 | (102,000 | ) | |||||
Net provision for federal income tax | $ | 0 | $ | 0 | ||||
The cumulative tax effect at the expected rate of 34% of significant items comprising our net deferred tax amount is as follows as of September 30, 2013 and December 31, 2012: | ||||||||
2013 | 2012 | |||||||
Deferred tax asset attributable to: | ||||||||
Net operating loss carryover | $ | 4,618,000 | $ | 4,706,000 | ||||
Valuation allowance | (4,618,000 | ) | (4,706,000 | ) | ||||
Net deferred tax asset | $ | 0 | $ | 0 | ||||
Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of approximately $13,583,000 for Federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carry forwards may be limited as to use in future years. |
CONTINGENT_LIABILITY
CONTINGENT LIABILITY | 9 Months Ended |
Sep. 30, 2013 | |
Notes to Financial Statements | ' |
CONTINGENT LIABILITY | ' |
On January 14, 2013, the Company hired a new CEO. The employment agreement required annual compensation of $175,000 that was to be accrued and deferred until at least January 1, 2014. Additionally, the agreement required the issuance of 2,000,000 options with an exercise price of $1.00 for a term of five years. The options were not exercisable until at least January 1, 2014, and were only exercisable after reaching certain financial terms and conditions. Due to these restrictions, no accrual was made for the issuance of these options. | |
On September 20, 2013, the Company entered into a separation agreement with the CEO. As part of the terms of the separation agreement, the accrued compensation up to the date of separation was paid and the options were terminated. Also as part of the agreement, the Company will be involved with the former CEO in a limited role as a consultant for one year to assist in various initiatives and in transition of various ongoing projects for 500,000 shares of company stock. Half of the value of the shares will be expensed immediately, with the other half expensed over the one year life of the agreement. 7.69% of the second half of the stock value has been expensed at September 30, 2013, with the remainder to be expensed as services are rendered over the remaining life of the agreement. The unamortized balance has been recorded as Deferred Stock Compensation in the equity section of the balance sheet. |
OPERATING_EXPENSES
OPERATING EXPENSES | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Notes to Financial Statements | ' | |||||||||||||||
OPERATING EXPENSES | ' | |||||||||||||||
Operating expenses consisted of the following for the three and nine months ended September 30, 2013 and 2012, respectively: | ||||||||||||||||
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Advertising | $ | 23,207 | $ | 1,167 | $ | 30,372 | $ | 45,088 | ||||||||
Professional fees | 151,610 | 83,235 | 275,004 | 186,188 | ||||||||||||
Consulting | 25,657 | 0 | 65,786 | 7,835 | ||||||||||||
Salaries, wages and benefits | 344,979 | 299,286 | 1,040,238 | 900,751 | ||||||||||||
Rent | 15,148 | 15,148 | 45,444 | 47,214 | ||||||||||||
Depreciation and amortization | 48,225 | 46,735 | 144,562 | 140,087 | ||||||||||||
Stock-based compensation | 281,925 | 29,857 | 310,823 | 227,922 | ||||||||||||
Revenue share expense | 376,831 | 20,669 | 614,234 | 28,804 | ||||||||||||
General and administrative | 94,753 | 63,208 | 360,010 | 197,368 | ||||||||||||
Total Operating Expenses | $ | 1,362,335 | $ | 559,305 | $ | 2,886,473 | $ | 1,781,257 |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2013 | |
Subsequent Events [Abstract] | ' |
SUBSEQUENT EVENTS | ' |
In accordance with ASC 855-10, the Company has analyzed its operations subsequent to September 30, 2013 through the date these financial statements were issued and has determined that it does not have any material subsequent events to disclose in these financial statements other than the events described above. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | ' |
Basis of Presentation | ' |
Basis of Presentation | |
The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission (“SEC”), and should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s Form 10-K filed with the SEC as of and for the year ended December 31, 2012. In the opinion of management, all adjustments necessary for the financial statements to be not misleading for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. | |
Accounting Basis | ' |
Accounting Basis | |
The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“GAAP” accounting). The Company has adopted a December 31 fiscal year end. | |
Principles of Consolidation | ' |
Principles of Consolidation | |
The financial statements reflect the consolidated results of OptimizeRx Corporation (a Nevada corporation) and its wholly owned subsidiary OptimizeRx Corporation (a Michigan corporation). All material inter-company transactions have been eliminated in the consolidation. | |
Cash and Cash Equivalents | ' |
Cash and Cash Equivalents | |
For purposes of the accompanying financial statements, the Company considers all highly liquid instruments with an initial maturity of three months or less to be cash equivalents. | |
Fair Value of Financial Instruments | ' |
Fair Value of Financial Instruments | |
The fair value of cash, accounts receivable, prepaid expenses, patent rights, web development costs, accounts payable, accounts payable – related party, accrued expenses and deferred revenue approximates the carrying amount of these financial instruments due to their short-term nature. The fair value of long-term debt, which approximates its carrying value, is based on current rates at which the Company could borrow funds with similar remaining maturities. | |
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. Bad debt expense was $0 for the nine months ended September 30, 2013 and 2012, respectively. The allowance for doubtful accounts was $0 as of September 30, 2013 and December 31, 2012, respectively. | |
Property and Equipment | ' |
Property and Equipment | |
The capital assets are being depreciated over their estimated useful lives, three to seven years using the straight-line method of depreciation for book purposes. | |
Revenue Recognition | ' |
Revenue Recognition | |
All revenue is recognized when it is earned. Revenues are generated either through the Company’s website activities, in which we earn revenue from advertising and lead generation activities, or from our SampleMD activities, which include offering setup within the systems and our offers, coupons, and vouchers that enable our customers to save money on medical products and services. The Company’s processes are monitored by third parties who collect revenues from clients on a per activity basis and report and forward the revenue to the Company’s account. | |
Research and Development | ' |
Research and Development | |
The Company’s key members are part of a continual research development team and monitor new technologies, trends, services and partnerships that can provide the Company with additional services, value to healthcare and pharmaceutical industries and to the patients it serves. | |
The Company seeks to educate team members through understanding of all market dynamics that have the potential to affect the business both short term and longer term. The primary goal is to help patients better afford and access the medicines their doctor prescribes, as well as other healthcare products and services they need. Based on this, the Company continually seeks better ways to meet this mission through technology, better user experiences and new ways to engage industries to provide new support for patients needing their products. The Company is always seeking new services and solutions to offer. At this time, the three current platforms provide robust opportunities and growth during the next five years. | |
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 bases 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. | |
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. | |
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 depreciable lives of such assets and the allowance for doubtful accounts receivable. Actual results could differ from these estimates. | |
Earnings Per Common and Common Equivalent Share | ' |
Earnings Per Common and Common Equivalent Share | |
The computation of basic earnings per common share is computed using the weighted average number of common shares outstanding during the year. The computation of diluted earnings per common share is based on the weighted average number of shares outstanding during the year plus common stock equivalents which would arise from the exercise of warrants outstanding using the treasury stock method and the average market price per share during the year. Options, warrants and convertible preferred stock which are common stock equivalents are included in the per share calculation for the three and nine months ended September 30, 2013. They have not been included in the diluted earnings per share calculation for the three and nine months ended September 30, 2012 since their effect is anti-dilutive. | |
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 | |
The Company does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company’s results of operations, financial position or cash flow. |
PREPAID_EXPENSES_Tables
PREPAID EXPENSES (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Notes to Financial Statements | ' | |||||||
Schedule of Prepaid Expenses | ' | |||||||
2013 | 2012 | |||||||
Insurance | $ | 6,653 | $ | 6,437 | ||||
Rent | 5,049 | 5,049 | ||||||
Consulting | 14,634 | 31,672 | ||||||
Legal | 0 | 25,000 | ||||||
Total prepaid expenses | $ | 26,336 | $ | 68,158 |
PROPERTY_AND_EQUIPMENT_Tables
PROPERTY AND EQUIPMENT (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||
Schedule of Property and Equipment | ' | |||||||
2013 | 2012 | |||||||
Computer equipment | $ | 22,360 | $ | 22,360 | ||||
Furniture and fixtures | 11,088 | 11,088 | ||||||
Subtotal | 33,448 | 33,448 | ||||||
Accumulated depreciation | (16,984 | ) | (12,763 | ) | ||||
Property and equipment, net | $ | 16,464 | $ | 20,685 |
WEB_DEVELOPMENT_COSTS_Tables
WEB DEVELOPMENT COSTS (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Notes to Financial Statements | ' | |||||||
Schedule of Web Development Costs | ' | |||||||
2013 | 2012 | |||||||
OptimizeRx web development | $ | 154,133 | $ | 154,133 | ||||
SampleMD web development | 602,517 | 602,517 | ||||||
SampleMD 2.0 | 62,280 | 0 | ||||||
Subtotal, web development costs | 818,930 | 756,650 | ||||||
Accumulated amortization | (408,069 | ) | (310,352 | ) | ||||
Impairment | (59,083 | ) | (59,083 | ) | ||||
Web development costs, net | $ | 351,778 | $ | 387,215 |
PATENT_RIGHTS_AND_INTANGIBLE_A1
PATENT RIGHTS AND INTANGIBLE ASSETS (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||
Schedule of Patent and Intangible Assets | ' | |||||||
2013 | 2012 | |||||||
Patent rights and intangible assets | $ | 930,000 | $ | 930,000 | ||||
Patent defense costs | 38,278 | 0 | ||||||
Accumulated amortization | (179,388 | ) | (136,764 | ) | ||||
Patent rights and intangible assets, net | $ | 788,890 | $ | 793,236 |
ACCRUED_EXPENSES_Tables
ACCRUED EXPENSES (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Payables and Accruals [Abstract] | ' | |||||||
Schedule of Accured Expenses | ' | |||||||
2013 | 2012 | |||||||
Accrued compensation | $ | 0 | $ | 0 | ||||
Accrued audit fees | 0 | 6,000 | ||||||
Total accrued expenses | $ | 0 | $ | 6,000 |
STOCK_OPTIONS_AND_WARRANTS_Tab
STOCK OPTIONS AND WARRANTS (Tables) | 9 Months Ended | ||||||||||
Sep. 30, 2013 | |||||||||||
Notes to Financial Statements | ' | ||||||||||
Schedule of Stock Options | ' | ||||||||||
Number of Options | Weighted average | ||||||||||
exercise price | |||||||||||
Outstanding, January 1, 2012 | 405,000 | $ | 1.01 | ||||||||
Granted - 2012 | 75,000 | 1.17 | |||||||||
Exercised - 2012 | 0 | 0 | |||||||||
Expired - 2012 | (455,000 | ) | (.98 | ) | |||||||
Balance, December 31, 2012 | 25,000 | 1.58 | |||||||||
Granted - 2013 | 0 | 0 | |||||||||
Exercised - 2013 | 0 | 0 | |||||||||
Expired - 2013 | 0 | 0 | |||||||||
Balance, September 30, 2013 | 25,000 | $ | 1.58 | ||||||||
Schedule of Warrants | ' | ||||||||||
Number of Warrants | Weighted average exercise price | ||||||||||
Outstanding, January 1, 2012 | 14,344,434 | $ | 2.41 | ||||||||
Granted - 2012 | 0 | 0 | |||||||||
Exercised - 2012 | 0 | 0 | |||||||||
Expired - 2012 | 0 | 0 | |||||||||
Balance, December 31, 2012 | 14,344,434 | 2.41 | |||||||||
Granted - 2013 | 0 | 0 | |||||||||
Exercised - 2013 | 0 | 0 | |||||||||
Expired - 2013 | (672,000 | ) | (2.59 | ) | |||||||
Balance, September 30, 2013 | 13,672,434 | $ | 2.44 |
OPERATING_LEASES_Tables
OPERATING LEASES (Tables) | 9 Months Ended | ||||||
Sep. 30, 2013 | |||||||
Leases [Abstract] | ' | ||||||
Schedule of Rent Expense | ' | ||||||
Year ended December 31, 2013 | $ | 60,591 | |||||
2014 | 55,542 | ||||||
2015 | 0 | ||||||
Total lease commitment | $ | 116,133 |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Income Tax Disclosure [Abstract] | ' | |||||||
Federal Income Tax | ' | |||||||
2013 | 2012 | |||||||
Federal income tax (expense) benefit attributable to: | ||||||||
Current operations | $ | (88,000 | ) | $ | 102,000 | |||
Valuation allowance | 88,000 | (102,000 | ) | |||||
Net provision for federal income tax | $ | 0 | $ | 0 | ||||
Deferred Tax Asset | ' | |||||||
2013 | 2012 | |||||||
Deferred tax asset attributable to: | ||||||||
Net operating loss carryover | $ | 4,618,000 | $ | 4,706,000 | ||||
Valuation allowance | (4,618,000 | ) | (4,706,000 | ) | ||||
Net deferred tax asset | $ | 0 | $ | 0 |
OPERATING_EXPENSES_Tables
OPERATING EXPENSES (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Notes to Financial Statements | ' | |||||||||||||||
Schedule of Operating Expenses | ' | |||||||||||||||
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Advertising | $ | 23,207 | $ | 1,167 | $ | 30,372 | $ | 45,088 | ||||||||
Professional fees | 151,610 | 83,235 | 275,004 | 186,188 | ||||||||||||
Consulting | 25,657 | 0 | 65,786 | 7,835 | ||||||||||||
Salaries, wages and benefits | 344,979 | 299,286 | 1,040,238 | 900,751 | ||||||||||||
Rent | 15,148 | 15,148 | 45,444 | 47,214 | ||||||||||||
Depreciation and amortization | 48,225 | 46,735 | 144,562 | 140,087 | ||||||||||||
Stock-based compensation | 281,925 | 29,857 | 310,823 | 227,922 | ||||||||||||
Revenue share expense | 376,831 | 20,669 | 614,234 | 28,804 | ||||||||||||
General and administrative | 94,753 | 63,208 | 360,010 | 197,368 | ||||||||||||
Total Operating Expenses | $ | 1,362,335 | $ | 559,305 | $ | 2,886,473 | $ | 1,781,257 |
NATURE_OF_BUSINESS_Details_Nar
NATURE OF BUSINESS (Details Narrative) | 9 Months Ended | |
Sep. 30, 2013 | Apr. 18, 2008 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ' |
Date of Organization | 31-Jan-06 | ' |
Date of Incorporation | 22-Oct-07 | ' |
Capital stock of OptimizeRx Corporation exchanged for common stock of RFID, Ltd | ' | 1,256,958 |
Ownership of outstanding capital stock of RFID, Ltd. | ' | 100.00% |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) (USD $) | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Accounting Policies [Abstract] | ' | ' | ' |
Fiscal Year End | '--12-31 | ' | ' |
Bad Debt Expense | $0 | $0 | ' |
Allowance for doubtful accounts | $0 | ' | $0 |
Capital Assets Useful Life, Minimum | '3 years | ' | ' |
Capital Assets Useful Life, Maximum | '7 years | ' | ' |
PREPAID_EXPENSES_Schedule_of_P
PREPAID EXPENSES - Schedule of Prepaid Expenses (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ' | ' |
Insurance | $6,653 | $6,437 |
Rent | 5,049 | 5,049 |
Consulting | 14,634 | 31,672 |
Legal | 0 | 25,000 |
Total prepaid expenses | $26,336 | $68,158 |
PROPERTY_AND_EQUIPMENT_Schedul
PROPERTY AND EQUIPMENT - Schedule of Property and Equipment (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Property, Plant and Equipment [Abstract] | ' | ' |
Computer equipment | $22,360 | $22,360 |
Furniture and fixtures | 11,088 | 11,088 |
Subtotal | 33,448 | 33,448 |
Accumulated depreciation | -16,984 | -12,763 |
Property and equipment, net | $16,464 | $20,685 |
PROPERTY_AND_EQUIPMENT_Details
PROPERTY AND EQUIPMENT (Details Narrative) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Property, Plant and Equipment [Abstract] | ' | ' | ' | ' |
Depreciation | $1,407 | $1,382 | $4,221 | $4,094 |
WEB_DEVELOPMENT_COSTS_Schedule
WEB DEVELOPMENT COSTS - Schedule of Web Development Costs (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Notes to Financial Statements | ' | ' |
OptimizeRx web development | $154,133 | $154,133 |
SampleMD web development | 602,517 | 602,517 |
SampleMD 2.0 | 62,280 | 0 |
Subtotal, web development costs | 818,930 | 756,650 |
Accumulated amortization | -408,069 | -310,352 |
Impairment | -59,083 | -59,083 |
Web development costs, net | $351,778 | $387,215 |
WEB_DEVELOPMENT_COSTS_Details_
WEB DEVELOPMENT COSTS (Details Narrative) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Notes to Financial Statements | ' | ' | ' | ' | ' |
Useful Life of Website | ' | ' | '5 years | ' | ' |
SampleMD 2.0 | $62,280 | ' | $62,280 | ' | $0 |
Unamortized Debt Issuance Expense | -59,083 | ' | -59,083 | ' | -59,083 |
Amortization Expense of Website | $32,572 | $31,677 | $97,717 | $94,964 | ' |
PATENT_RIGHTS_AND_INTANGIBLE_A2
PATENT RIGHTS AND INTANGIBLE ASSETS - Schedule of Patent and Intangible Assets (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ' |
Patent rights and intangible assets | $930,000 | $930,000 |
Patent defense costs | 38,278 | 0 |
Accumulated amortization | -179,388 | -136,764 |
Patent rights and intangible assets, net | $788,890 | $793,236 |
PATENT_RIGHTS_AND_INTANGIBLE_A3
PATENT RIGHTS AND INTANGIBLE ASSETS (Details Narrative) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Apr. 26, 2010 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ' | ' | ' | ' |
Common stock shares granted to acquire exclusive patent rights | ' | ' | ' | ' | 300,000 |
Options granted to acquire exclusive patent rights | ' | ' | ' | ' | 200,000 |
Options granted to acquire exclusive patent rights, value | ' | ' | ' | ' | $360,000 |
Common stock shares granted to acquire exclusive patent rights, value | ' | ' | ' | ' | 570,000 |
Useful life of Patent | ' | ' | '17 years | ' | ' |
Amortization Expense of Patent | $14,246 | $13,676 | $42,624 | $41,029 | ' |
ACCRUED_EXPENSES_Schedule_of_A
ACCRUED EXPENSES - Schedule of Accured Expenses (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Payables and Accruals [Abstract] | ' | ' |
Accrued compensation | $0 | $0 |
Accrued audit fees | 0 | 6,000 |
Total accrued expenses | $0 | $6,000 |
ACCRUED_EXPENSES_Details_Narra
ACCRUED EXPENSES (Details Narrative) (USD $) | Jan. 14, 2013 |
Payables and Accruals [Abstract] | ' |
Annual Compensation for CEO | $175,000 |
Issuance of stock options to CEO, shares | 2,000,000 |
Issuance of stock options to CEO, par value | 1 |
Term of options agreement | '5 years |
Exercisable date | 1-Jan-14 |
DEFERRED_REVENUE_Details_Narra
DEFERRED REVENUE (Details Narrative) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Revenue Recognition [Abstract] | ' | ' |
Deferred revenue | $13,272 | $49,252 |
RELATED_PARTY_TRANSACTIONS_Det
RELATED PARTY TRANSACTIONS (Details Narrative) (USD $) | Dec. 31, 2012 |
Related Party Transactions [Abstract] | ' |
Share Based Compensation Arrangement of Stock Options Issued | 300,000 |
Common Stock Issued For Purchase Of Patent | 200,000 |
Share Based Compensation Arrangement of Stock Options Value | $360,000 |
Common Stock Value On Grant Date | $570,000 |
COMMON_STOCK_Details_Narrative
COMMON STOCK (Details Narrative) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Jun. 01, 2013 | Jul. 12, 2012 | Jun. 01, 2012 | Jan. 02, 2014 | Sep. 20, 2013 |
North Coast Advisors | North Coast Advisors | North Coast Advisors | Separation Agreement | Separation Agreement | |||
Common Stock Shares Authorized | 500,000,000 | 500,000,000 | ' | ' | ' | ' | ' |
Common Stock Par Value Per Share | $0.00 | $0.00 | ' | ' | ' | ' | ' |
Common Stock Shares Issued | 14,752,496 | 14,232,496 | ' | ' | ' | ' | ' |
Shares Issued | ' | ' | 20,000 | 40,000 | 40,000 | 250,000 | 250,000 |
Shares Issued, per share value | ' | ' | $1.95 | $1.12 | ' | ' | ' |
Term of Agreement | ' | ' | 'P2Y | ' | 'P2Y | ' | ' |
Shares Issued, value | $14,752 | $14,232 | ' | ' | ' | ' | $505,000 |
Deferred stock compensation | ($233,077) | $0 | ' | ' | ' | ' | ($233,077) |
PREFERRED_STOCK_Details_Narrat
PREFERRED STOCK (Details Narrative) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||
Sep. 30, 2011 | Dec. 31, 2010 | Dec. 31, 2008 | Sep. 21, 2011 | Mar. 25, 2011 | Nov. 16, 2010 | 12-May-10 | Sep. 30, 2013 | Sep. 30, 2012 | Feb. 29, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Feb. 29, 2012 | |
Series A | Series A | Series A | Series B | Series B | Series B | ||||||||
Preferred Stock Series A Stock Share Issued For Proceeds | ' | ' | 35 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Stock Series A Value | ' | ' | $3,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Stock Series A Stock Issuance Expense | ' | ' | 515,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Stock Series A Stock Net Proceeds | ' | ' | 2,985,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible Preferred Stock Series A Shares Issued Upon Conversion | ' | ' | 3,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Stock Series A Stock Dividend Rate Percentage | ' | ' | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock Warrants Issued For Purchase | 1,000,000 | 3,000,000 | 6,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock Warrants Exercise Price | 3 | 3 | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock Warrants Expiration | '7 years | '7 years | '7 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock Shares Issued For Dividend Payment | ' | ' | ' | 156,306 | 176,768 | 173,922 | 236,598 | ' | ' | ' | ' | ' | ' |
Preferred Stock Series B Shares Issued For Proceeds | 15 | 15 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Stock Series B Value | 1,500,000 | 1,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible Preferred Stock Series B Shares Issued Upon Conversion | 1,000,000 | 1,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Stock Series B Stock Dividend Rate Percentage | 10.00% | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Stock Series B Stock Issuance Expense | ' | 350,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Stock Series B Stock Net Proceeds | ' | 1,150,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock Warrants Issued | ' | 3,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Stock Value On Grant Date | 855,460 | 341,100 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock Warrant Value On Grant Date | 644,540 | 1,158,900 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock Shares Issued For Dividend Payment For Series B | ' | ' | ' | 66,988 | 75,758 | ' | ' | ' | ' | ' | ' | ' | ' |
Undeclared dividends | ' | ' | ' | ' | ' | ' | ' | $700,000 | $350,000 | $350,000 | $300,000 | $150,000 | $150,000 |
STOCK_OPTIONS_AND_WARRANTS_Sch
STOCK OPTIONS AND WARRANTS - Schedule of Stock Options (Details) | 12 Months Ended | |
Dec. 31, 2012 | Sep. 30, 2013 | |
Notes to Financial Statements | ' | ' |
Beginning Balance, number of shares | 405,000 | 25,000 |
Beginning Balance, weighted average exercise price | 1.01 | 1.58 |
Options granted, number of shares | 75,000 | ' |
Options granted, weighted average exercise price | 1.17 | ' |
Options exercised, number of shares | 0 | ' |
Options exercised, weighted average exercise price | 0 | ' |
Options expired, number of shares | -455,000 | ' |
Options expired, weighted average exercise price | -0.98 | ' |
Ending Balance, number of shares | 25,000 | 25,000 |
Ending Balance, weighted average exercise price | 1.58 | 1.58 |
STOCK_OPTIONS_AND_WARRANTS_Sch1
STOCK OPTIONS AND WARRANTS - Schedule of Warrants (Details) (USD $) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2013 | Dec. 31, 2012 | |
Notes to Financial Statements | ' | ' |
Beginning Balance, number of shares | 14,344,434 | 14,344,434 |
Beginning Balance, weighted average exercise price | $2.41 | $2.41 |
Warrants granted, number of shares | 0 | 0 |
Warrants granted, weighted average exercise price | $0 | $0 |
Warrants exercised, number of shares | 0 | 0 |
Warrants exercised, weighted average exercise price | $0 | $0 |
Warrants expired, number of shares | -672,000 | 0 |
Warrants expired, weighted average exercise price | ($2.59) | $0 |
Ending Balance, number of shares | 13,672,434 | 14,344,434 |
Ending Balance, weighted average exercise price | $2.44 | $2.41 |
STOCK_OPTIONS_AND_WARRANTS_Det
STOCK OPTIONS AND WARRANTS (Details Narrative) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Share Based Compensation Expense | $281,925 | $29,857 | $310,823 | $227,922 |
Two Employees Stock Options | ' | ' | ' | ' |
Share Based Compensation Expense | ' | ' | ' | 14,459 |
Individual Stock Options | ' | ' | ' | ' |
Share Based Compensation Expense | ' | ' | ' | 75,117 |
Non-Employee Stock Options | ' | ' | ' | ' |
Share Based Compensation Expense | ' | ' | $30,006 | ' |
Schedule_of_Rent_Expense_Detai
Schedule of Rent Expense (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Leases [Abstract] | ' | ' | ' |
Minimum Annual Lease Amount | $0 | $55,542 | $60,591 |
Total 3 year Lease Commitment | ' | ' | $116,133 |
OPERATING_LEASES_Details_Narra
OPERATING LEASES (Details Narrative) (USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Leases [Abstract] | ' |
Monthly Rent Due | $5,000 |
Term Of Lease | '3 years |
Monthly Rent Option | $5,200 |
MAJOR_CUSTOMERS_Details_Narrat
MAJOR CUSTOMERS (Details Narrative) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Notes to Financial Statements | ' | ' |
Major Customers | 63.00% | 53.00% |
INCOME_TAXES_Federal_Income_Ta
INCOME TAXES - Federal Income Tax (Details) (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Federal income tax (expense) benefit attributable to: | ' | ' |
Current operations | ($88,000) | $102,000 |
Valuation allowance | 88,000 | -102,000 |
Net provision for federal income tax | $0 | $0 |
INCOME_TAXES_Deferred_Tax_Asse
INCOME TAXES - Deferred Tax Asset (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Deferred tax asset attributable to: | ' | ' |
Net operating loss carryover | $4,618,000 | $4,706,000 |
Valuation allowance | -4,618,000 | -4,706,000 |
Net deferred tax asset | $0 | $0 |
INCOME_TAXES_Details_Narrative
INCOME TAXES (Details Narrative) (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Dec. 31, 2012 | |
Income Tax Disclosure [Abstract] | ' | ' |
Operating Income Loss | $260,000 | ' |
Operating Loss Carryforwards | $13,583,000 | $13,843,000 |
Carryforward Expiration Date | 1-Jan-33 | ' |
Effective Income Tax Rate | 34.00% | ' |
CONTINGENT_LIABILITY_Details_N
CONTINGENT LIABILITY (Details Narrative) (USD $) | Jan. 14, 2013 | Jan. 02, 2014 | Sep. 20, 2013 |
Separation Agreement | Separation Agreement | ||
Annual Compensation for CEO | $175,000 | ' | ' |
Issuance of stock options to CEO, shares | 2,000,000 | ' | ' |
Issuance of stock options to CEO, par value | 1 | ' | ' |
Term of options agreement | '5 years | ' | ' |
Exercisable date | 1-Jan-14 | ' | ' |
Shares Issued | ' | 250,000 | 250,000 |
OPERATING_EXPENSES_Schedule_of
OPERATING EXPENSES - Schedule of Operating Expenses (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Notes to Financial Statements | ' | ' | ' | ' |
Advertising | $23,207 | $1,167 | $30,372 | $45,088 |
Professional fees | 151,610 | 83,235 | 275,004 | 186,188 |
Consulting | 25,657 | 0 | 65,786 | 7,835 |
Salaries, wages and benefits | 344,979 | 299,286 | 1,040,238 | 900,751 |
Rent | 15,148 | 15,148 | 45,444 | 47,214 |
Depreciation and amortization | 48,225 | 46,735 | 144,562 | 140,087 |
Stock-based compensation | 281,925 | 29,857 | 310,823 | 227,922 |
Revenue share expense | 376,831 | 20,669 | 614,234 | 28,804 |
General and administrative | 94,753 | 63,208 | 360,010 | 197,368 |
Total Operating Expenses | $1,362,335 | $559,305 | $2,886,473 | $1,781,257 |