OptimizeRx (OPRX) 10-Q 14 Aug 14 2014 Q2 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	6 Months Ended
	Jun. 30, 2014	Aug. 11, 2014
Document And Entity Information	'	'
Entity Registrant Name	'OptimizeRx Corp	'
Entity Central Index Key	'0001448431	'
Document Type	'10-Q	'
Document Period End Date	30-Jun-14	'
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	'	23,362,377
Document Fiscal Period Focus	'Q2	'
Document Fiscal Year Focus	'2014	'

CONSOLIDATED_BALANCE_SHEETS

CONSOLIDATED BALANCE SHEETS (USD $)	Jun. 30, 2014	Dec. 31, 2013
Current Assets	'	'
Cash and cash equivalents	$3,549,698	$1,118,243
Accounts receivable	1,264,762	1,566,964
Prepaid expenses	41,969	11,771
Total Current Assets	4,856,429	2,696,978
Property and equipment, net	13,909	15,057
Other Assets	'	'
Patent rights, net	946,703	885,950
Web-based technology, net	443,385	404,986
Security deposit	5,049	5,049
Total Other Assets	1,395,137	1,295,985
TOTAL ASSETS	6,265,475	4,008,020
Current Liabilities	'	'
Accounts payable - trade	362,628	188,739
Accounts payable - related party	570,000	570,000
Accrued expenses	'	12,000
Revenue share payable	506,901	1,193,661
Deferred revenue	42,908	4,252
Total Liabilities	1,482,437	1,968,652
Stockholders Equity	'	'
Preferred stock, $.001 par value, 10,000,000 shares authorized, 0 and 65 shares issued and outstanding	0	0
Common stock, $.001 par value, 500,000,000 shares authorized, 23,362,377 and 14,773,496 shares issued and outstanding	23,362	14,773
Stock warrants	3,147,709	18,148,049
Additional paid-in-capital	27,304,112	8,726,708
Deferred stock compensation	-369,929	-233,942
Accumulated deficit	-25,322,216	-24,616,220
Total Stockholders Equity	4,783,038	2,039,368
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY	$6,265,475	$4,008,020

CONSOLIDATED_BALANCE_SHEETS_Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Jun. 30, 2014	Dec. 31, 2013
Statement of Financial Position [Abstract]	'	'
Preferred Stock, Par Value	$0.00	$0.00
Preferred Stock, Shares Authorized	10,000,000	10,000,000
Preferred Stock, Issued	0	65
Common Stock, Par Value	$0.00	$0.00
Common Stock, Shares Authorized	500,000,000	500,000,000
Common Stock, Issued	23,362,377	14,773,496

CONSOLIDATED_STATEMENTS_OF_OPE

CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Mar. 31, 2013	Jun. 30, 2014	Jun. 30, 2013
Income Statement [Abstract]	'	'	'	'
NET REVENUE	$1,454,214	$1,104,087	$2,771,560	$1,773,377
REVENUE SHARE EXPENSE	540,048	451,494	1,038,858	734,924
GROSS MARGIN	914,166	652,593	1,732,702	1,038,453
OPERATING EXPENSES	967,070	552,766	2,439,028	1,286,735
INCOME (LOSS) FROM OPERATIONS	-52,904	99,827	-706,326	-248,282
OTHER INCOME (EXPENSE)	'	'	'	'
Interest income	223	38	330	94
TOTAL OTHER INCOME (EXPENSE)	223	38	330	94
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES	-52,681	99,865	-705,996	-248,188
PROVISION FOR INCOME TAXES	'	'	'	'
NET (LOSS)	($52,681)	$99,865	($705,996)	($248,188)
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC	23,241,707	14,238,870	20,355,651	14,335,700
NET (LOSS) PER SHARE: BASIC	'	$0.01	($0.04)	($0.02)
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: DILUTED	'	33,608,304	'	'
NET (LOSS) PER SHARE: DILUTED	'	'	'	'

CONSOLIDATED_STATEMENTS_OF_CAS

CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
CASH FLOWS FROM OPERATING ACTIVITIES:	'	'
Net (loss) for the period	($705,996)	($248,188)
Adjustments to reconcile net (loss) to net cash provided by operating activities:	'	'
Depreciation and amortization	115,828	96,337
Stock options issued for services	654,634	38,900
Changes in:	'	'
Accounts receivable	302,202	-322,887
Prepaid expenses	-30,198	12,439
Accounts payable	173,889	-42,543
Revenue share payable	-686,760	497,521
Accrued expenses	-12,000	-81,500
Deferred revenue	-38,656	-6,632
NET CASH PROVIDED BY OPERATING ACTIVITIES	-149,745	-106,447
CASH FLOWS FROM INVESTING ACTIVITIES:	'	'
Purchases of property and equipment	-1,592	'
Patent rights	-92,624	-38,278
Web development costs	-119,616	'
NET CASH USED IN INVESTING ACTIVITIES	-213,832	-38,278
CASH FLOWS FROM FINANCING ACTIVITIES:	'	'
Issuance of common stock	10,000,000	'
Equity issuance costs	-1,204,968	'
Purchase of common and preferred stock and warrants	-6,000,000	'
NET CASH PROVIDED BY FINANCING ACTIVITIES	2,795,032	'
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	2,431,455	68,169
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD	1,118,243	284,263
CASH AND CASH EQUIVALENTS - END OF PERIOD	3,549,698	352,432
SUPPLEMENTAL CASH FLOW INFORMATION:	'	'
Cash paid for interest	'	'
Cash paid for income taxes	'	'

NATURE_OF_BUSINESS_AND_BASIS_O

NATURE OF BUSINESS AND BASIS OF PRESENTATION	6 Months Ended
	Jun. 30, 2014
Organization, Consolidation and Presentation of Financial Statements [Abstract]	'
NATURE OF BUSINESS AND BASIS OF PRESENTATION	'
	OptimizeRx Corporation, is a technology solution company focused on the health care industry. Its 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.
	The consolidated financial statements for the three and six month periods ended June 30, 2014 and 2013 have been prepared by us without audit pursuant to the rules and regulations of the Securities and Exchange Commission. In the opinion of management, all adjustments necessary to present fairly our financial position, results of operations, and cash flows as of June 30, 2014 and 2013, and for the periods then ended, have been made. Those adjustments consist of normal and recurring adjustments. The consolidated balance sheet as of December 31, 2013, has been derived from the audited consolidated balance sheet as of that date.
	Certain information and note disclosures normally included in our annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. These consolidated financial statements should be read in conjunction with a reading of the financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2013, as filed with the U.S. Securities and Exchange Commission.
	The results of operations for the three and six month periods ended June 30, 2014, are not necessarily indicative of the results to be expected for the full year. Certain reclassifications have been made in the prior period’s consolidated financial statements to conform to the current period’s presentation.

STOCKHOLDERS_EQUITY

STOCKHOLDERS EQUITY	6 Months Ended
	Jun. 30, 2014
Equity [Abstract]	'
STOCKHOLDERS EQUITY	'
	In March 2014, the Company entered into a securities purchase agreement, pursuant to which the Company sold an aggregate of 8,333,333 shares of the Company’s common stock for $1.20 per share, or gross proceeds of $10,000,000.
	Placement agents in the offering received commissions equal to approximately 9.7% of gross proceeds, for an aggregate commission of approximately $970,000, including reimbursements for their reasonable out of pocket expenses. Placement agents also received warrants to purchase up to 804,139 shares of the Company's common stock with an exercise price of $1.20 per share and a term of 5 years. The warrants were valued at $1,110,211, have been recorded as equity issuance costs, and were registered on a registration statement dated May 28, 2014.
	In addition to the warrants, the Company also paid cash bonuses of $240,000 to three officers, issued 200,000 shares to three officers, and 150,000 shares to a consultant, in connection with the equity raise. The stock was valued based on the fair market value on the grant date, which was $630,000 in total. These amounts have been recorded as equity issuance costs.
	The Company used the net proceeds of the offering to exercise the securities redemption option agreement, as amended, with Vicis Capital Master Fund that provided the Company with an option to purchase all of the outstanding shares and derivative securities held by Vicis for total payment of $6,000,000. The shares and derivative securities included the Series A Convertible Preferred Stock, Series B Convertible Preferred Stock, Common Stock, and warrants to purchase shares of common stock held by Vicis in the Company. The balance of the net proceeds will be used for working capital purposes.
	In January 2014, an officer exercised 500,000 stock warrants using the cashless exercise feature. In exchange for the 500,000 warrants, 410,348 shares of common stock were issued.
	During the six months ended June 30, 2014, the Company granted 337,500 shares of common stock to two employees as bonuses valued at $570,375 based on the unique accomplishment of recapitalizing the company to secure an additional $3MM in working capital while reducing 7 MM in fully diluted shares As of June 30, 2014, only 50% of the shares had vested. The company recorded the remaining 50% as deferred stock-based compensation. Stock-based compensation related to these bonuses was $285,188 for the six months ended June 30, 2014. The remainder will be expensed once the other 50% of the shares have vested in August 2014.
	During the six months ended June 30, 2014, the Company issued 54,000 shares of common stock to consultants in connection with investor relations services. These shares were valued based on the fair market value on the date of grant, which resulted in expense totaling $82,300.
	No shares of common stock were issued in the six months ended June 30, 2013.

SHARE_BASED_PAYMENTS_OPTIONS

SHARE BASED PAYMENTS - OPTIONS	6 Months Ended
	Jun. 30, 2014
Equity [Abstract]	'
SHARE BASED PAYMENTS - OPTIONS	'
	We use the fair value method to account for stock based compensation. We recorded $170,611 and $38,900 in compensation expense in the periods ended June 30, 2014 and 2013, respectively, related to options issued under our stock-based incentive compensation plan. This includes expense related to both options issued and committed in the current year, and options issued in prior years for which the requisite service period for those options includes the current year. The fair value of these instruments were calculated using the Black-Scholes option pricing model. Information related to the assumptions used in this model is set forth in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013. Assumptions for options issued in the current year approximated the same assumptions, with estimated lives ranging from 3.5 to 5 years.

CONTINGENCIES

CONTINGENCIES	6 Months Ended
	Jun. 30, 2014
Commitments and Contingencies Disclosure [Abstract]	'
CONTINGENCIES	'
	In November 2013, Plaintiffs in the action Milton Wilpon et al. v. Continental Capital Corporation, C-289-06, Superior Court of New Jersey (the “Action”) served the Company with notice that they were seeking to amend the caption of the Action to add the Company as a judgment debtor on a default judgment obtained by Plaintiffs.  In 2007 Plaintiffs obtained a default judgment in the amount of $929,559 against Continental Capital Corporation (“Continental”) in the Action (the “Default Judgment”). The Court denied Plaintiffs’ request to amend the caption to add the Company as a defendant liable on the Default Judgment and directed Plaintiffs to file a motion for leave to amend the Complaint to add the Company as a party to the Action, which motion Plaintiffs filed and the Court granted.  On March 15, 2014, Plaintiffs served a Second Amended Complaint alleging that the Company is Continental’s successor in interest and is therefore liable on the Default Judgment. On April 14, 2014, the Company filed an Answer with Counterclaims and Third-Party Claims (the “Answer”).  The Answer (1) denied the allegations in the Second Amended Complaint on the ground that the Default Judgment is infirm in numerous respects, including because it is tainted by fraud and is an abuse of the legal process, and should therefore be vacated and (2) asserted counterclaims and third-party claims against other parties responsible for the obligations related to the Default Judgment.
	On or about May 16, 2014, Plaintiffs filed a motion to dismiss of the Company’s Answer and to enter final judgment against the Company in an amount equal to the Default Judgment.  On June 5, 2014, the Company filed opposition to Plaintiffs’ motion and filed a cross-motion to vacate the Default Judgment. The Company moved to vacate the Default Judgment on several grounds including that the initial complaint was not properly served, that Plaintiffs obtained the Default Judgment by making material misrepresentations to the Court about the sufficiency of service among other issues and that Plaintiffs entirely failed initially to file their claims in an arbitration with the American Arbitration Association, as required by the agreement upon which Plaintiffs based their claims. The Court has scheduled oral argument on Plaintiffs’ motion and on the Company’s cross-motion for August 21, 2014.
	On February 6, 2013, we filed a Complaint for Patent Infringement against Physicians Interactive Inc., Physicians Interactive Holdings, Inc. and Skyscape.com, in which we allege that one or more of those entities has infringed on United States Patent No. 8,341,015. The defendants responded denying the assertions made in our Complaint. On August 7, 2014, the parties signed a settlement agreement whereby both parties dismissed their actions and released each other form claims that were, or might have been, asserted in the action. This settlement will reduce legal expense moving forward.

RESTATEMENT

RESTATEMENT	6 Months Ended
	Jun. 30, 2014
Equity [Abstract]	'
RESTATEMENT	'
	The Company restated its financial statements to change the way it accounts for revenue share expense. The full impact of the restatement was reflected in the December 31, 2013 financial statements at the end of the year. The tables below reflect the impact on the three and six month periods reflected in this report.
	The restated Consolidated Balance Sheet, Consolidated Statement of Operations and Consolidated Statement of Cash Flows for the periods ended June 30, 2013 is as follows:
	Six months ended June 30, 2013
	Financial Statement	Line Item		Corrected			Previously Stated
	Income statement	Revenue share expense	$	734,924		$	237,403
	Income statement	Income (Loss) from operations	$	(248,282	)	$	249,239
	Income statement	Income (loss) before income taxes	$	(224,188	)	$	249,333
	Income statement	Net income (loss)	$	(224,188	)	$	249,333
	Statement of cash flows	Net income (loss)	$	(224,188	)	$	249,333
	Statement of cash flows	Increase in revenue share payable	$	497,521		$	0
	Three months ended June 30, 2013
	Financial Statement	Line Item		Corrected			Previously Stated
	Income statement	Revenue share expense	$	451,494		$	197,200
	Income statement	Income from operations	$	99,827		$	354,121
	Income statement	Income before provision for income taxes	$	99,865		$	354,159
	Income statement	Net income	$	99,865		$	354,159

SUBSEQUENT_EVENTS

SUBSEQUENT EVENTS	6 Months Ended
	Jun. 30, 2014
Subsequent Events [Abstract]	'
SUBSEQUENT EVENTS	'
	On August 7, 2014, we signed a settlement agreement with Physicians Interactive, Inc. described in greater detail in Note 4 above, whereby both parties dismissed their actions and released each other from all claims that were or might have been asserted in the action.
	In accordance with ASC 855-10, the Company has analyzed its operations subsequent to March 31, 2014 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.

RESTATEMENT_Tables

RESTATEMENT (Tables)	6 Months Ended
	Jun. 30, 2014
Equity [Abstract]	'
Schedule of Restatement Six Months Ended	'
	Six months ended June 30, 2013
	Financial Statement	Line Item		Corrected			Previously Stated
	Income statement	Revenue share expense	$	734,924		$	237,403
	Income statement	Income (Loss) from operations	$	(248,282	)	$	249,239
	Income statement	Income (loss) before income taxes	$	(224,188	)	$	249,333
	Income statement	Net income (loss)	$	(224,188	)	$	249,333
	Statement of cash flows	Net income (loss)	$	(224,188	)	$	249,333
	Statement of cash flows	Increase in revenue share payable	$	497,521		$	0
Schedule of Restatement Three Months Ended	'
	Three months ended June 30, 2013
	Financial Statement	Line Item		Corrected			Previously Stated
	Income statement	Revenue share expense	$	451,494		$	197,200
	Income statement	Income from operations	$	99,827		$	354,121
	Income statement	Income before provision for income taxes	$	99,865		$	354,159
	Income statement	Net income	$	99,865		$	354,159

NATURE_OF_BUSINESS_AND_BASIS_O1

NATURE OF BUSINESS AND BASIS OF PRESENTATION (Details Narrative)	6 Months Ended
	Jun. 30, 2014
Organization, Consolidation and Presentation of Financial Statements [Abstract]	'
Current Fiscal Year End	'--12-31

STOCKHOLDERS_EQUITY_Details_Na

STOCKHOLDERS EQUITY (Details Narrative) (USD $)	6 Months Ended			0 Months Ended		0 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013	Mar. 18, 2014	Mar. 17, 2014	Mar. 18, 2014	Jan. 29, 2014	Jun. 30, 2014	Jun. 30, 2014	Jan. 02, 2014	Jun. 30, 2014
				Securities Sold under Agreement	Securities Sold under Agreement	Three Officers	Cashless Exercise	Employee Bonus	Equity Raise	Vicis Capital Amdt #1	Investor Relation Services
Common Stock Shares Authorized	500,000,000	'	500,000,000	'	'	'	'	'	'	'	'
Common Stock Par Value Per Share	$0.00	'	$0.00	'	'	'	'	'	'	'	'
Common Stock Shares Issued	23,362,377	'	14,773,496	'	'	'	'	'	'	'	'
Shares Issued	'	'	'	'	8,333,333	200,000	410,348	337,500	150,000	'	54,000
Shares Issued, per share value	'	'	'	'	$1.20	'	'	'	'	'	'
Shares Issued, value	$23,362	'	$14,773	'	'	'	'	$570,375	$630,000	'	$82,300
Deferred stock compensation	-369,929	'	-233,942	'	'	'	'	285,188	'	'	'
Stock-based compensation	170,611	38,900	'	'	'	'	'	'	'	'	'
Debt redemption, amount	'	'	'	'	'	'	'	'	'	6,000,000	'
Shares Issued, proceeds	'	'	'	'	10,000,000	'	'	'	'	'	'
Commissions	'	'	'	'	970,000	'	'	'	'	'	'
Common Stock Warrants Issued	'	'	'	804,139	'	'	'	'	'	'	'
Common Stock Warrants Exercise Price	'	'	'	1.2	'	'	'	'	'	'	'
Common Stock Warrants Expiration	'	'	'	'5 years	'	'	'	'	'	'	'
Common stock issued for equity issuance costs	'	'	'	'	'	378,000	'	'	'	'	'
Warrants exercised, number of shares	'	'	'	'	'	'	-500,000	'	'	'	'
Warrants, Value	'	'	'	1,110,211	'	'	'	'	'	'	'
Employee Bonus	'	'	'	'	'	'	'	'	$240,000	'	'

SHARE_BASED_PAYMENTS_OPTIONS_D

SHARE BASED PAYMENTS - OPTIONS (Details Narrative) (USD $)	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Equity [Abstract]	'	'
Share Based Compensation Expense	$170,611	$38,900

CONTINGENCIES_Details_Narrativ

CONTINGENCIES (Details Narrative) (USD $)	6 Months Ended
	Jun. 30, 2014
Contingencies Details Narrative	'
Plaintiff Default Judgment	$929,559

RESTATEMENT_Schedule_of_Restat

RESTATEMENT - Schedule of Restatement (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Mar. 31, 2013	Jun. 30, 2014	Jun. 30, 2013
REVENUE SHARE EXPENSE	$540,048	$451,494	$1,038,858	$734,924
INCOME (LOSS) FROM OPERATING	-52,904	99,827	-706,326	-248,282
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES	-52,681	99,865	-705,996	-248,188
NET INCOME (LOSS)	-52,681	99,865	-705,996	-248,188
Net income (loss) for the period	'	'	-705,996	-248,188
Revenue share payable	'	'	-686,760	497,521
Correction	'	'	'	'
REVENUE SHARE EXPENSE	'	'	'	734,924
INCOME (LOSS) FROM OPERATING	'	'	'	-248,282
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES	'	'	'	-224,188
NET INCOME (LOSS)	'	'	'	-224,188
Net income (loss) for the period	'	'	'	-224,188
Revenue share payable	'	'	'	497,521
Previously Stated	'	'	'	'
REVENUE SHARE EXPENSE	'	'	'	237,403
INCOME (LOSS) FROM OPERATING	'	'	'	249,239
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES	'	'	'	249,333
NET INCOME (LOSS)	'	'	'	249,333
Net income (loss) for the period	'	'	'	249,333
Revenue share payable	'	'	'	$0

RESTATEMENT_Schedule_of_Restat1

RESTATEMENT - Schedule of Restatement 3M (Details) (USD $)	3 Months Ended		6 Months Ended		3 Months Ended
	Jun. 30, 2014	Mar. 31, 2013	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2013	Jun. 30, 2013
					Previously Stated	Correction
REVENUE SHARE EXPENSE	$540,048	$451,494	$1,038,858	$734,924	$451,494	$197,200
INCOME (LOSS) FROM OPERATING	-52,904	99,827	-706,326	-248,282	99,827	354,121
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES	-52,681	99,865	-705,996	-248,188	99,865	354,159
NET INCOME (LOSS)	($52,681)	$99,865	($705,996)	($248,188)	$99,865	$354,159