HealthWarehouse.com (HEWA) 10-Q 22 Oct 13 2013 Q1 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	3 Months Ended
	Mar. 31, 2013	Oct. 18, 2013
Document And Entity Information
Entity Registrant Name	HealthWarehouse.com, Inc.
Entity Central Index Key	754813
Document Type	10-Q
Document Period End Date	31-Mar-13
Amendment Flag	FALSE
Current Fiscal Year End Date	-19
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	No
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		26,529,091
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2013

CONDENSED_CONSOLIDATED_BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)	Mar. 31, 2013	Dec. 31, 2012
Current assets:
Cash	$382,353
Restricted cash	125,000	850,002
Accounts receivable, net	221,211	214,973
Inventories - finished goods, net	310,065	395,584
Prepaid expenses and other current assets	41,841	52,292
Total current assets	1,080,470	1,512,851
Property and equipment, net	757,665	768,021
Total assets	1,838,135	2,280,872
Current liabilities:
Accounts payable - trade	2,882,558	2,973,774
Accounts payable - related parties	211,932	147,933
Accrued expenses and other current liabilities	700,258	1,942,769
Deferred revenue	104,228	73,787
Current portion of equipment lease payable	50,802	49,122
Convertible notes		1,000,000
Notes payable and other advances, net of debt discount of $0 and $44,363 as of March 31, 2013 and December 31, 2012, respectively	40,000	1,955,637
Note payable and other advances - related parties		765,000
Redeemable preferred stock - Series C; par value $0.001 per share; 10,000 designated Series C: 10,000 issued and outstanding as of March 31, 2013 and December 31, 2012 (aggregate liquidation preference of $1,000,000)	1,000,000	1,000,000
Total current liabilities	4,989,778	9,908,022
Long term liabilities:
Long term portion of equipment lease payable	152,847	166,286
Note payable, net of debt discount of $315,300 as of March 31, 2013	184,700
Total long term liabilities	337,547	166,286
Total liabilities	5,327,325	10,074,308
Preferred stock - par value $0.001 per share; authorized 1,000,000 shares; issued and outstanding as of March 31, 2013 and December 31, 2012 as above and as follows:
Convertible preferred stock - Series A - 200,000 shares designated Series A; 44,443 shares available to be issued; no shares issued and outstanding
Convertible preferred stock - Series B - 625,000 shares designated Series B; 422,315 and 394,685 shares issued and outstanding as of March 31, 2013 and December 31, 2012 , respectively (aggregate liquidation preference of $4,060,717 and $3,990,877 as of March 31, 2013 and December 31, 2012, respectively)	422	395
Common stock - par value $0.001 per share; authorized 50,000,000 shares; 24,175,156 and 13,030,397 shares issued and 22,995,944 and 11,851,185 shares outstanding as of March 31, 2013 and December 31, 2012, respectively	24,175	13,031
Additional paid-in capital	26,465,916	16,460,385
Employee advances	-50,386	-18,858
Treasury stock, at cost, 1,179,212 shares as of March 31, 2013 and December 31, 2012	-3,419,715	-3,419,715
Accumulated deficit	-26,509,602	-20,828,674
Total stockholders' deficiency	-3,489,190	-7,793,436
Total liabilities and stockholders' deficiency	$1,838,135	$2,280,872

CONDENSED_CONSOLIDATED_BALANCE1

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Mar. 31, 2013	Dec. 31, 2012
Current liabilities:
Current Portion Notes Payable, deferred debt discount	$0	$44,363
Redeemable preferred stock Series C, par value	0.001	0.001
Redeemable preferred stock Series C, shares designated	10,000	10,000
Redeemable preferred stock Series C, shares issued	10,000	10,000
Redeemable preferred stock Series C, shares outstanding	10,000	10,000
Redeemable preferred stock Series C, aggregate liquidation preference	1,000,000	1,000,000
Note payable, net of debt discount	315,300
Stockholders' deficiency:
Preferred stock, par value	$0.00	$0.00
Preferred stock, authorized	1,000,000	1,000,000
Preferred stock, shares issued	1,000,000	1,000,000
Preferred stock, shares outstanding	1,000,000	1,000,000
Series A Convertible preferred stock, shares designated	200,000	200,000
Series A Convertible preferred stock, shares available to be issued	44,443	44,443
Series A Convertible preferred stock, shares issued	0	0
Series A Convertible preferred stock, shares outstanding	0	0
Series B Convertible preferred stock, shares designated	625,000	625,000
Series B Convertible preferred stock, shares issued	422,315	394,685
Series B Convertible preferred stock, shares outstanding	422,315	394,685
Series B Convertible preferred stock, aggregate liquidation preference	$4,060,717	$3,990,877
Common stock, par value	$0.00	$0.00
Common stock, authorized	50,000,000	50,000,000
Common stock, shares issued	24,175,156	13,030,397
Common stock, shares outstanding	22,995,944	11,851,185
Treasury stock, shares	1,179,212	1,179,212

CONDENSED_CONSOLIDATED_STATEME

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (USD $)	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Condensed Consolidated Statements Of Operations
Net sales	$2,409,916	$3,153,607
Cost of sales	1,235,156	1,704,647
Gross profit	1,174,760	1,448,960
Operating expenses:
Selling, general and administrative expenses	2,389,103	2,684,478
Loss from operations	-1,214,343	-1,235,518
Other income (expense):
Loss on extinguishment of debt	-2,792,900
Interest income		2,548
Interest expense	-71,123	-317,342
Total other expense	-2,864,023	-314,794
Net loss	-4,078,366	-1,550,312
Series B convertible contractual dividends	-69,840	-65,271
Series B convertible deemed dividends	-1,532,722
Series C redeemable deemed dividends		-92,916
Loss attributable to common stockholders	-5,680,928	-1,708,499
Per share data:
Net loss - basic and diluted	($0.26)	($0.15)
Series B convertible contractual dividends		($0.01)
Series B convertible deemed dividends	($0.10)
Series C redeemable deemed dividends		($92,916)
Net loss attributable to common stockholders - basic and diluted	($0.36)	($0.17)
Weighted average number of common shares outstanding - basic and diluted	15,609,892	10,191,353

CONDENSED_CONSOLIDATED_STATEME1

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $)	3 Months Ended		12 Months Ended
	Mar. 31, 2013	Mar. 31, 2012	Dec. 31, 2012
Cash flows from operating activities
Net loss	($4,078,366)	($1,550,312)	($5,574,775)
Adjustments to reconcile net loss to net cash used in operating activities:
Provision for doubtful accounts	-31,528	10,521
Depreciation and amortization	35,846	111,851
Stock-based compensation	330,021	259,409
Warrants issued to 2012 private placement investors	487,200
Loss on extinguishment of notes and accounts payable	2,792,900
Imputed value of services contributed	87,500
Amortization of debt discount	44,363	215,711
Changes in operating assets and liabilities:
Accounts receivable	-6,238	21,542
Inventories - finished goods	85,519	106,206
Prepaid expenses and other current assets	10,451	17,386
Accounts payable - trade	-91,216	550,400
Accounts payable - related parties	185,999	-4,902
Accrued expenses and other current liabilities	-340,265	84,793
Deferred revenue	30,441
Net cash used in operating activities	-457,373	-177,395	-947,911
Cash flows from investing activities
Change in restricted cash	725,002
Changes in employee advances		-81,043
Website development costs	-25,490
Net cash provided by (used in) investing activities	699,512	-81,043
Cash flows from financing activities
Principal payments on equipment leases payable	-11,759	-22,131
Proceeds from issuance of notes payable	500,000
Repayment of notes payable	-2,000,000
Repayment of convertible notes payable	-1,000,000
Proceeds from the sale of common stock	2,526,973	125,000
Proceeds from offering in advance of equity offering closing	125,000
Cash overdraft		-155,656
Proceeds from notes payable and other advances - related parties		375,000
Repayment of notes payable and other advances - related parties		-63,812
Net cash provided by financing activities	140,214	258,401
Net increase (decrease) in cash	382,353	-37
Cash - beginning of year		40	40
Cash - end of year	382,353	3
Interest	367,978	21,491
Taxes
Non-cash investing and financing activities:
Issuance of Series B preferred stock for settlement of accrued dividends	261,084	244,001
Cashless exercise of warrants into common stock	6,934
Cashless exercise of options into common stock		93
Warrants issued as debt discount in connection with notes payable	315,300
Accrual of contractual dividends on Series B convertible preferred stock	69,840	65,271
Deemed dividends on Series B convertible preferred stock	1,532,722
Reclassification of accounts payable - trade to equipment lease payable		257,583
Deemed dividend - redeemable Series C preferred stock		92,916
Common stock and warrants issued in exchange of notes and accounts payable	$3,625,900

CONDENSED_CONSOLIDATED_STATEME2

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) (USD $)	Convertible Series B Preferred Stock	Common Stock	Additional Paid-In Capital	Employee Advances	Treasury Stock	Accumulated Deficit	Total
Beginning Balance, Amount at Dec. 31, 2012	$395	$13,031	$16,460,385	($18,858)	($3,419,715)	($20,828,674)	($7,793,436)
Beginning Balance, Shares at Dec. 31, 2012	394,685	13,030,397			1,179,212
Stock-based compensation			330,021				330,021
Warrants issued to 2012 private placement investors			487,200				487,200
Issuance of Series B preferred stock as payment-in-kind for dividend, Amount	27		261,057				261,084
Issuance of Series B preferred stock as payment-in-kind for dividend, Shares	27,630
Cashless exercise of warrants into common stock, Amount		6,934	-6,934
Cashless exercise of warrants into common stock, Shares		6,934,784
Contractual dividends on Series B convertible preferred stock						-69,840	-69,840
Beneficial conversion feature and deemed dividend on Series B convertible preferred stock			1,532,722			-1,532,722
Warrants issued as debt discount in connection with notes payable			315,300				315,300
Conversion of notes and accounts payable into common stock and warrants, Amount		833	3,625,067				3,625,900
Conversion of notes and accounts payable into common stock and warrants, Shares		833,000
Issuance of common stock and warrants for cash, Amount		3,377	3,373,598				3,376,975
Issuance of common stock and warrants for cash, Shares		3,376,975
Imputed value of services contributed			87,500				87,500
Reduction in value of employee advance reserve				-31,528			-31,528
Net loss						-4,078,366	-4,078,366
Ending Balance, Amount at Mar. 31, 2013	$422	$24,175	$26,465,916	($50,386)	($3,419,715)	($26,509,602)	($3,489,190)
Ending Balance, Shares at Mar. 31, 2013	422,315	24,175,156			1,179,212

Organization_and_Basis_of_Pres

Organization and Basis of Presentation	3 Months Ended
	Mar. 31, 2013
Organization And Basis Of Presentation
Note 1 - Organization and Basis of Presentation	HealthWarehouse.com, Inc., a Delaware company incorporated in 1998, (the “Company”) is a U.S. licensed virtual retail pharmacy (“VRP”) and healthcare e-commerce company that sells brand name and generic prescription drugs as well as over-the-counter (“OTC”) medical products. The Company’s objective is to be viewed by individual healthcare product consumers as a low-cost, reliable and hassle-free provider of prescription drugs and OTC medical products. The Company is presently licensed as a mail-order pharmacy for sales to 50 states and the District of Columbia.
	The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. Accordingly, they do not include all of the information and disclosures required by GAAP for annual financial statements. In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the condensed consolidated financial statements of the Company as of March 31, 2013 and for the three months ended March 31, 2013 and 2012. The results of operations for the three months ended March 31, 2013 are not necessarily indicative of the operating results for the full year ending December 31, 2013. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related disclosures of the Company as of December 31, 2012 and for the year then ended, which were filed with the Securities and Exchange Commission on Form 10-K on July 23, 2013.

Going_Concern_and_Managements_

Going Concern and Management's Liquidity Plans	3 Months Ended
	Mar. 31, 2013
Going Concern And Managements Liquidity Plans
Note 2 - Going Concern and Management's Liquidity Plans	Since inception, the Company has financed its operations primarily through debt and equity financings and advances from related parties. As of March 31, 2013, the Company had a working capital deficiency of $3,909,308 and an accumulated deficit of $26,509,602.  During the three months ended March 31, 2013 and year ended December 31, 2012, the Company incurred net losses of $4,078,366 and $5,574,775 and used cash in operating activities of $457,373 and $947,911, respectively. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.
	Subsequent to March 31, 2013, the Company (a) had a closing of its private placement offering in the amount of $125,000 which funds had been received by the Company during the three months ended March 31, 2013; (b) raised an aggregate of $149,000 in debt financings; and (c) continues to incur net losses, use cash in operating activities and experience cash and working capital constraints. See Note 11.
	On February 13, 2013, the Company received a Notice of Redemption related to its Series C Redeemable Preferred Stock aggregating $1,000,000 (see Note 7). As a result of receiving the Notice of Redemption, the Company must now apply all of its assets to redemption of the Series C Preferred Stock and to no other corporate purpose, except to the extent prohibited by Delaware law governing distributions to stockholders (the Company is not permitted to utilize toward the redemption those assets required to pay its debts as they come due and those assets required to continue as a going concern).
	The Company recognizes it will need to raise additional capital in order to fund operations, meet its payment obligations and execute its business plan. There is no assurance that additional financing will be available when needed or that management will be able to obtain financing on terms acceptable to the Company and whether the Company will become profitable and generate positive operating cash flow. If the Company is unable to raise sufficient additional funds, it will have to develop and implement a plan to further extend payables, attempt to extend note repayments, attempt to negotiate the preferred stock redemption and reduce overhead until sufficient additional capital is raised to support further operations. There can be no assurance that such a plan will be successful.  If the Company is unable to obtain financing on a timely basis, the Company could be forced to sell its assets, discontinue its operation and /or seek reorganization under the U.S. bankruptcy code.
	Accordingly, the accompanying condensed consolidated financial statements have been prepared in conformity with GAAP, which contemplates continuation of the Company as a going concern and the realization of assets and the satisfaction of liabilities in the normal course of business. The carrying amounts of assets and liabilities presented in the condensed consolidated financial statements do not necessarily represent realizable or settlement values. The condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Summary_of_Significant_Account

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2013
Summary Of Significant Accounting Policies
Note 3 - Summary of Significant Accounting Policies	Principles of Consolidation
	The condensed consolidated financial statements include the accounts of HealthWarehouse.com, Inc., Hwareh.com, Inc., Hocks.com, Inc., ION Holding NV, and ION Belgium NV, its wholly-owned subsidiaries. ION Holding NV and ION Belgium NV are inactive subsidiaries. All material inter-company balances and transactions have been eliminated in consolidation.
	Use of Estimates
	The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.  The Company’s significant estimates include reserves related to accounts receivable and inventory, the recoverability and useful lives of long-lived assets, the valuation allowance related to deferred tax assets, the valuation of equity instruments and debt discounts.
	Reclassifications
	Certain accounts in the prior period condensed consolidated financial statements have been reclassified for comparison purposes to conform to the presentation of the current period condensed consolidated financial statements.  These reclassifications had no effect on the previously reported net loss.
	Revenue Recognition
	Revenues for the sales of products are recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed and determinable and collectability is reasonably assured. The Company defers revenue when cash has been received from the customer but delivery has not yet occurred.  Such amounts are reflected as deferred revenues in the accompanying condensed consolidated financial statements.
	Net Loss Per Share of Common Stock
	Basic net loss per share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period.  Diluted net loss per share reflects the potential dilution that could occur if securities or other instruments to issue common stock were exercised or converted into common stock.  Potentially dilutive securities are excluded from the computation of diluted net loss per share if their inclusion would be anti-dilutive and consist of the following:
		March 31,
		2013		2012
	Options		2,451,483		2,033,807
	Warrants		6,047,119		2,916,590
	Series B Convertible Preferred Stock		3,407,313		1,973,425
	Convertible Promissory Notes		-		529,100
	Total potentially dilutive shares		11,905,915		7,452,922
	Stock-Based Compensation
	Stock-based compensation expense for all stock-based payment awards is based on the estimated fair value of the award. For employees and directors, the award is measured on the grant date.  For non-employees, the award is measured on the grant date and is then remeasured at each vesting date and financial reporting date.  The Company recognizes the estimated fair value of the award as compensation cost over the requisite service period of the award, which is generally the option vesting term.  The Company generally issues new shares of common stock to satisfy option and warrant exercises.
	Recently Issued Accounting Pronouncements
	In July 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2013-11, “Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists." This ASU addresses the requirements regarding the financial statement presentation of an unrecognized tax benefit within Accounting Standards Codification ("ASC") Topic 740 for the purpose of providing consistency between the financial reporting of U.S. GAAP entities. Generally, this ASU provides guidance for the preparation of financial statements and disclosures when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists.  This ASU is effective for periods beginning after December 15, 2013 and is not expected to have any impact on the Company’s condensed consolidated financial statements or disclosures.

Accrued_Expenses_and_Other_Cur

Accrued Expenses and Other Current Liabilities	3 Months Ended
	Mar. 31, 2013
Accrued Expenses And Other Current Liabilities
Note 4 - Accrued Expenses and Other Current Liabilities	Accrued expenses and other current liabilities consisted of the following:
		March 31,		December 31,
		2013		2012
	Deferred rent	$	40,889	$	39,100
	Advertising		75,000		75,000
	Salaries and benefits		220,075		166,118
	Professional fees		50,000		81,872
	Dividends payable		69,840		261,084
	Accrued interest		44,250		410,101
	Due to investors (1)		125,000		850,002
	Customer payables		59,018		51,333
	Other		16,186		8,159
	Total	$	700,258	$	1,942,769
	(1) - Proceeds received from investors in advance of equity offering closing.

Convertible_Notes_Payable

Convertible Notes Payable	3 Months Ended
	Mar. 31, 2013
Convertible Notes Payable
Note 5 - Convertible Notes Payable	On February 1, 2013, the Company repaid convertible notes with an outstanding principal balance of $1,000,000 plus outstanding accrued interest of $163,861. The convertible notes bore interest at a rate of 7% per annum compounded annually and were due on December 31, 2012. The Company recorded amortization of debt discount associated with convertible notes payable of $82,616 for the three months ended March 31, 2012 using the effective interest method. As of December 31, 2012, the debt discount had been fully amortized.

Notes_Payable

Notes Payable	3 Months Ended
	Mar. 31, 2013
Notes Payable
Note 6 - Notes Payable	On February 1, 2013, the Company repaid notes with an outstanding principal balance of $2,000,000 plus outstanding accrued interest of $199,260. The notes bore interest at a rate of 7% per annum and were due on January 15, 2013. The Company recorded amortization of debt discount associated with notes payable of $44,363 and $133,095 for the three months ended March 31, 2013 and 2012, respectively, using the effective interest method.
	On March 28, 2013, the Company entered into a Loan and Security Agreement (the “Loan Agreement”) with a lender (the "Lender"). Under the terms of the Loan Agreement, the Company borrowed $500,000 from the Lender (the “Loan”). The Loan is evidenced by a promissory note (the “March Note”) and bears interest on the unpaid principal balance of the March Note until the full amount of principal has been paid at a floating rate equal to the Prime Rate plus four and one-quarter percent (4.25%) per annum (as of March 31, 2013, the Prime Rate was 3.25% per annum). Under the terms of the Loan Agreement, the Company has agreed to make monthly payments of accrued interest on the first day of every month, beginning on May 1, 2013. The principal amount and all unpaid accrued interest on the March Note is payable on March 1, 2015, or earlier in the event of default or a sale or liquidation of the Company. The Loan may be prepaid in whole or in part at any time by the Company without penalty.
	The Company granted the Lender a first, priority security interest in all of the Company’s assets, in order to secure the Company’s obligation to repay the Loan. The Loan Agreement contains customary negative covenants restricting the Company’s ability to take certain actions without the Lender’s consent, including incurring additional indebtedness, transferring or encumbering assets, paying dividends or making certain other payments, and acquiring other businesses. Upon the occurrence of an event of default, the Lender has the right to impose interest at a rate equal to five percent (5.0%) per annum above the otherwise applicable interest rate (the “Default Rate”). The repayment of the Loan may be accelerated prior to the maturity date upon certain specified events of default, including failure to pay, bankruptcy, breach of covenant, and breach of representations and warranties.
	In consideration of the Loan, the Company granted the Lender a five-year warrant to purchase 750,000 shares of common stock at an exercise price of $0.35 per share. The warrants contain customary anti-dilution provisions. The warrant had a relative fair value of $315,300 which was set up as debt discount and will be amortized using the effective interest method over the term of the Loan.  Including the value of the warrant, the March Note had an effective interest rate of 40% per annum.
	See Note 7 – Stockholders’ Deficiency – Common Stock for details regarding the conversion of outstanding notes payable – related parties into common stock and warrants.
	See Note 11 – Subsequent Events for additional details.

Stockholders_Deficiency

Stockholders' Deficiency	3 Months Ended
	Mar. 31, 2013
Stockholders Deficiency
Note 7 - Stockholders' Deficiency	Common Stock
	During the three months ended March 31, 2013, pursuant to a private placement offering of units that commenced on October 4, 2012 (the “Private Placement”), the Company received an aggregate of $3,376,975 of proceeds related to the sale of 3,376,975 units at a price of $1.00 per unit. The aggregate amount includes $500,000, which was received from an officer, and $850,002, which was received during the fourth quarter of 2012 and classified as restricted cash as of December 31, 2012. Each unit consists of (i) one share of the Company’s common stock and (ii) a five-year warrant to purchase three shares of the Company’s common stock at an exercise price of $0.25 per share, such that warrants to purchase an aggregate of 10,130,925 shares of common stock were issued. Substantially all of the proceeds from the sale of the units were used by the Company to satisfy all of its obligations under the convertible notes and notes (see Notes 5 and 6). In connection with the Private Placement, an officer has entered into repurchase agreements with certain purchasers of units, pursuant to which he has agreed to repurchase, subject to certain conditions, one-half of these holder’s units at a purchase price of $1.00 per unit if the closing price of the Common Stock is less than $0.25 on five consecutive trading days at any time within one year of February 1, 2013. Cape Bear, which holds a substantial equity position in the Company, also entered into repurchase agreements with certain purchasers, other than the officer, that are substantially similar to the officer’s agreements, except that Cape Bear’s obligations are secured by a lien over certain real estate.
	On March 13, 2013, the Company exchanged $761,000 of notes payable and other advances – related parties and $72,000 of accounts payable to a related party into an aggregate of 833,000 units at a price of $1.00 per unit. Each unit consists of (i) one share of the Company’s common stock, and (ii) a five-year warrant to purchase two and three-quarters shares of the Company’s common stock at an exercise price of $0.25 per share (such that warrants to purchase an aggregate of 2,290,750 shares of common stock were issued). The $3,625,900 aggregate fair value of the securities issued ($2,639,700 related to the warrants and $986,200 related to the common stock) was credited to equity at conversion. The Company recorded a $2,792,900 extinguishment loss which represents the incremental fair value of the securities issued as compared to the carrying value of the liabilities.
	Series B Preferred Stock
	On January 1, 2013, the Company issued 27,630 shares of Series B Convertible Preferred Stock valued at $261,084, representing approximately $0.66 in value per share of Series B Preferred Stock outstanding to the Series B Convertible Preferred Stockholders as payment in kind for dividends (the “2013 Series B Dividend”). In connection with the 2013 Series B Dividend, the Company recognized a $202,305 beneficial conversion feature during the three months ended March 31, 2013, which represents the difference between the commitment date value of the shares and the effective conversion price. In connection with the outstanding preferred stock, during the three months ended March 31, 2013 and 2012, the Company recorded $69,840 and $65,271 as contractual 7% dividends, respectively. As of December 31, 2012, February 1, 2013, March 13, 2013 and April 11, 2013, Series B holders are entitled to convert into 5.00, 7.61, 8.07 and 8.14 shares, respectively, of the Company’s common stock for each share of Series B Preferred Stock due to the anti-dilution provision. The anti-dilution provision represents a contingent beneficial conversion feature.  As of March 31, 2013, an incremental 1,295,738 shares of common stock are issuable at conversion of the Series B Convertible Preferred Stock as compared to the original terms.   Using the commitment date common stock price in effect, the commitment date value of the incremental shares is $3,332,792. However, recognition of beneficial conversion features is limited to the aggregate gross proceeds allocated to the preferred stock of $3,199,689 (422,315 shares of Series B Convertible Preferred Stock times $9.45 per share less the relative fair value of the warrants of $791,188) less the $1,666,967 beneficial conversion feature already recognized on the original issuance of 365,265 shares of Series B Preferred Stock (prior to the issuance of additional shares as payment-in-kind in lieu of cash dividends) and the $202,305 recognized related to the 2013 Series B Dividend. Due to these limitations, a beneficial conversion feature of $1,330,417 related to the incremental shares was recognized during the three months ended March 31, 2013.
	Series C Preferred Stock
	On February 13, 2013, the Company received a Notice of Redemption of Series C Preferred Stock. As a result of the Convertible Notes coming due and not being paid on December 31, 2012, the Company accelerated the accretion rate of the deemed dividend on the Redeemable Preferred Stock – Series C and reclassified the Redeemable Preferred Stock – Series C from temporary equity to current liabilities. The Company recorded Series C deemed dividends of $92,916 during the three months ended March 31, 2012.  As of December 31, 2012, the discount associated with the Series C Preferred Stock was fully amortized.
	Stock Options
	In applying the Black-Scholes option pricing model to stock options granted, the Company used the following weighted average assumptions:
		For The Three Months Ended
		March 31,
		2013			2012
	Risk free interest rate		1.13	%		1.04	%
	Dividend yield		0	%		0	%
	Expected volatility		166	%		172.2	%
	Expectd life in years		6			6
	The weighted average fair value of the stock options granted during the three months ended March 31, 2013 and 2012 was $1.20 and $5.27 per share, respectively.
	On February 15, 2013, the Company granted options to employees to purchase an aggregate of 330,500 shares of common stock under the 2009 Plan at an exercise price of $1.60 per share for an aggregate grant date value of $395,041. The options vest over a three year period and have a term of ten years.
	Stock-based compensation expense related to stock options for the three months ended March 31, 2013 and 2012 was recorded in the condensed consolidated statements of operations as a component of selling, general and administrative expenses and totaled $312,444 and $259,409, respectively.  As of March 31, 2013, stock-based compensation expense related to stock options of $2,916,160 remains unamortized, including $2,024,591 which is being amortized over the weighted average remaining period of 2.3 years.  The remaining $891,569 is related to a performance based option where vesting is currently deemed to be improbable and no amount is being amortized.
	A summary of the stock option activity during the three months ended March 31, 2013 is presented below:
								Weighted
					Weighted			Average
		Number			Average			Remaining
		of			Exercise			Life		Intrinsic
		Options			Price			In Years		Value
	Outstanding, January 1, 2013		2,183,899		$	3.42
	Granted		330,500			1.6
	Exercised		-			-
	Forfeited		(62,916	)		3.11
	Outstanding, March 31, 2013		2,451,483		$	3.18			6.2	$	77,331
	Exercisable, March 31, 2013		1,192,649		$	2.66			4.7	$	77,331
	The following table presents information related to stock options at March 31, 2013:
		Options Outstanding			Options Exercisable
		Weighted			Weighted		Weighted
	Range of	Average		Outstanding	Average		Average	Exercisable
	Exercise	Exercise		Number of	Exercise		Remaining Life	Number of
	Price	Price		Options	Price		In Years	Options
	$0.80 - $2.20	$         1.59		806,400	$         1.58		2.5	485,900
	$2.21 - $3.80	3.19		924,083	2.91		5.6	510,083
	$3.81 - $6.99	4.94		721,000	4.65		8.1	196,666
		$         3.18		2,451,483	$         2.66		4.7	1,192,649
	Warrants
	In applying the Black-Scholes option pricing model to stock warrants granted, the Company used the following weighted average assumptions:
		For The Three Months Ended
		March 31,
		2013			2012
	Risk free interest rate		0.88	%		n/a
	Dividend yield		0	%		n/a
	Expected volatility		164.3	%		n/a
	Expectd life in years		5			n/a
	The weighted average fair value of the stock warrants granted during the three months ended March 31, 2013 was $1.38 per share.  There were no warrants granted during the three months ended March 31, 2012.
	On February 15, 2013, the Company granted vested five-year warrants to purchase an aggregate of 408,348 shares of common stock at an exercise price of $1.00 per share to investors who purchased shares in private placements at $4.50 per share during 2012. The warrants had an aggregate issuance date fair value of $487,200 which was expensed immediately.
	See Note 7 – Stockholders’ Deficiency – Common Stock for details regarding warrants granted in connection with the Private Placement and the conversion of related party notes and accounts payable into equity.
	During the three months ended March 31, 2013, the Company issued an aggregate of 6,934,784 shares of common stock to several holders of warrants who elected to exercise warrants to purchase an aggregate of 8,125,750 shares of common stock on a "cashless" basis under the terms of the warrants. The warrants had an exercise price of $0.25 per share. The aggregate intrinsic value of the warrants exercised was $11,840,859 for the three months ended March 31, 2013.
	Stock-based compensation expense related to warrants for the three months ended March 31, 2013 and 2012 was recorded in the condensed consolidated statements of operations as a component of selling, general and administrative expenses and totaled $504,777 and $0, respectively. As of March 31, 2013, stock-based compensation expense related to warrants of $674,312 remains unamortized, including $97,472 which is being amortized over the weighted average remaining period of 2.5 years.  The remaining $576,840 is related to a performance based warrant where vesting is currently deemed to be improbable and no amount is being amortized.
	A summary of the stock warrant activity during the three months ended March 31, 2013 is presented below:
								Weighted
					Weighted			Average
					Average			Remaining
		Number of			Exercise			Life		Intrinsic
		Warrants			Price			In Years		Value
	Outstanding, January 1, 2013		592,846		$	3.01
	Granted		13,580,023			0.28
	Exercised		(8,125,750	)		0.25
Forfeited		-			-
Outstanding, March 31, 2013		6,047,119		$	0.58			4.7	$	4,618,507
Exercisable, March 31, 2013		5,767,119		$	0.46			4.8	$	4,618,507
The following table presents information related to stock warrants at March 31, 2013:
	Warrants Outstanding			Warrants Exercisable
	Weighted			Weighted		Weighted
Range of	Average		Outstanding	Average		Average	Exercisable
Exercise	Exercise		Number of	Exercise		Remaining Life	Number of
Price	Price		Warrants	Price		In Years	Warrants
$0.25 - $0.35	$        0.26		5,045,925	$        0.26		4.9	5,045,925
$0.36 - $1.60	1.00		408,348	1.00		4.9	408,348
$1.61 - $3.00	2.91		562,846	2.91		3.4	312,846
$3.01 - $4.95	4.95		30,000	-		-	-
	$        0.58		6,047,119	$        0.46		4.8	5,767,119
Services Contributed
Effective January 1, 2013, an executive officer of the Company waived payment for services contributed during 2013. As a result, the Company imputed the value of the services contributed and recorded salary expense of $87,500 for the three months ended March 31, 2013 with a corresponding credit to stockholders’ deficiency.

Commitments_and_Contingent_Lia

Commitments and Contingent Liabilities	3 Months Ended
	Mar. 31, 2013
Commitments And Contingent Liabilities
Note 8 - Commitments and Contingent Liabilities	Operating Leases
	On March 13, 2013, the Company gave notice of early termination for a lease agreement for a corporate apartment dated May 31, 2011.  Accordingly, the lease expired on March 31, 2013. The Company did not incur any penalties related to the early termination of the lease agreement.
	During the three months ended March 31, 2013 and 2012, the Company recorded aggregate rent expense of $45,719 and $52,457, respectively.
	Litigation
	On February 9, 2012, two of our former stockholders, Rock Castle and Jason Smith (“Plaintiffs”), filed suit against the Company in the Hamilton County, Ohio Court of Common Pleas, alleging that the Company had breached the terms of certain stock options the Company granted to the Plaintiffs in connection with the Company’s now-terminated oral consulting arrangements with the Plaintiffs, by among other things, refusing Plaintiffs’ purported exercise of options to purchase 233,332 shares of the Company’s common stock at an exercise price of $2.00 per share in December 2011.  Plaintiffs have requested that, among other things, the court require the Company to permit the exercise of the 233,332 options.  Plaintiffs have also provided an expert report indicating damages of $2.086 million. Also named as defendants were two individuals, Michael Peppel and Gary Singer, whom Plaintiffs claim acted as agents for the Company in connection with its purchase of shares of its common stock from Plaintiffs in September 2011. On April 26, 2013, Plaintiffs dismissed Mr. Singer from the lawsuit.  Trial of the case is currently scheduled for April of 2014.  The Company denies all of the Plaintiffs’ claims and intends to contest this matter vigorously.
	On October 9, 2012, American Express Travel Related Services Company, Inc. brought legal action against the Company in the Boone County, Kentucky Circuit Court. The action seeks to recover the unpaid balance on a credit card account in the amount of $87,029, plus interest and costs. The Company filed an answer in November 2012.  This litigation was resolved on July 10, 2013 by a negotiated settlement. Such amount has been accrued in the accompanying consolidated balance sheet as of March 31, 2013.
	On November 5, 2012, HD Smith, Inc., one of the Company’s vendors, (“Plaintiff”) filed a complaint against the Company alleging that it breached its vendor credit agreement. The Plaintiff is seeking damages of $170,316 plus pre-judgment interest and attorneys’ fees. This litigation was resolved on January 25, 2013, as amended on June 20, 2013, by a negotiated settlement. Such amount has been accrued in the accompanying consolidated balance sheet as of March 31, 2013.
	On March 13, 2013, a former vendor filed suit against the Company in the Hamilton County, Ohio Court of Common Pleas, alleging that the Company had breached its contract. The plaintiff is seeking damages of $17,800 plus pre-judgment interest and other costs and expenses. The Company answered the complaint and trial was set for June 2014.  This matter was resolved by a negotiated settlement. Such amount has been accrued in the accompanying consolidated balance sheet as of March 31, 2013.
	On March 20, 2013, a complaint was filed in the Delaware Court of Chancery by two shareholders of the Company, HWH Lending, LLC and Milfam I L.P., seeking to compel the holding of an annual meeting of stockholders for the election of directors under Delaware law.  The Company filed an answer to the complaint on April 12, 2013.  On May 13, 2013, the Company publicly announced that the Board of Directors had set the date for the Company’s next annual meeting of stockholders as August 15, 2013 at 11:00 a.m. Eastern time.  In lieu of further litigation, on July 18, 2013, the parties submitted to the court a proposed order confirming August 15, 2013 as the annual meeting date and establishing certain procedures related to the annual meeting.  On July 18, 2013, the court entered the proposed order providing that (i) the Company shall notice and hold its annual meeting on August 15, 2013 for the election of directors and for the transaction of any other business properly brought before the meeting, and the date of the  meeting shall not be adjourned, continued or postponed prior to the election of directors absent an order of the court; (ii) the shares of the Company’s stock represented at the annual meeting, either in person or by proxy, and entitled to vote thereat shall constitute a quorum for purposes of the meeting, notwithstanding any contrary provision in the Company’s certificate of incorporation or bylaws, and (iii) the record date for the determination of stockholders entitled to notice of and to vote at the annual meeting is July 1, 2013, and if the annual meeting noticed for August 15, 2013 is adjourned, continued or postponed prior to the election of directors pursuant to an order of the court, the Company may set a new record date in accordance with the Company’s bylaws. In accordance with the Court order, the Company’s annual meeting of stockholders was held on August 15, 2013 at which time Lalit Dhadphale, Youssef Bennani, Joseph Savarino, and Ambassador Ned Siegel each received a plurality of the total votes cast at the annual meeting and each was elected as a director by the stockholders of the Company. On September 24, 2013, this action was dismissed without prejudice by a joint stipulation of dismissal.
	On April 23, 2013, the Company’s Board of Directors formed a Special Committee, chaired by Youssef Bennani, a director and Chairman of the Company’s Audit Committee, to investigate certain stockholder demands.  Since March 1, 2013, the Company has received three letters from stockholders alleging certain breaches of fiduciary duties by directors of the Company and demanding that the Company commence investigations of the alleged conduct.  On March 1, 2013, the Company received a letter on behalf of the holders of the Company’s Series B Preferred Stock (“Preferred Holders”) alleging that a convicted felon appears to be a consultant to the Company, owes the Company money, and exercises control over the Company.  On March 8, 2013, the Company received a letter on behalf of stockholder Wayne Corona alleging that two directors, Matthew Stecker and John Backus, breached their fiduciary duties and demanding that the Company investigate legal claims against those directors.  The letter alleges that the director designee of the holders of the Company’s Series B Preferred Stock and the director designee of New Atlantic Ventures Fund III, L.P. (“NAV”) acted in concert to attempt to scuttle the Company’s recent financing plan.  The letter also alleged that the director designee of the Preferred Holders and the director designee of NAV sought to prevent the Company from paying back its lenders in 2010 and 2011.  On March 18, 2013, the Company received a letter on behalf of the two directors denying the allegations and stating there was no proper basis for launching an investigation.  On March 27, 2013, a letter on behalf of Messrs. Backus and Stecker, in their capacities as directors and stockholders, demanded that the Company (i) investigate alleged breaches of confidentiality and fiduciary duties by the Company’s President and CEO and two other directors in connection with the purported stockholder demand letter of Mr. Corona dated March 8, 2013, and (ii) assert related claims against those individuals.  The letter also asserted that the director constituting the special committee, Youssef Bennani, is subject to alleged conflicts of interest that disqualify him from serving on any proposed special committee to evaluate the pending stockholder demands.  The Special Committee has retained an independent law firm to conduct the investigation and advise the Special Committee.
	On April 30, 2013, a purported class-action complaint was filed against the Company in the United States District Court for the Northern District of Illinois.  The complaint alleges that the Company sent an unsolicited advertising fax to Glen Ellyn Pharmacy, the named plaintiff, and other recipients.  The complaint alleges that such a fax violates the federal Telephone Consumer Protection Act (the “TCPA”), the Illinois Consumer Fraud Act and Illinois common law.  Under the TCPA, recipients of unsolicited fax advertisements are entitled to damages of up to $500 per fax for inadvertent violations and up to $1,500 for knowing or willful violations.  At the time of filing the complaint, the plaintiff also filed a motion asking the Court to certify a class of persons and entities who were sent advertising faxes by the Company which did not contain an opt out notice.  On June 19, 2013, the plaintiff filed an amended class-action complaint which withdrew the two counts for alleged violations of the Illinois Consumer Fraud Act and the common law tort of conversion.  The amended complaint eliminates claims for damages under Illinois law and leaves only a single count for an alleged violation of the TCPA.  The Company filed an answer to the amended complaint on July 8, 2013 contesting class certification and liability. The District Court has not established or recognized any class.  This litigation was resolved on September 24, 2013. The settlement amount is deemed to be de minimis.
	On May 7, 2013, a putative stockholder derivative action was filed in the Court of Chancery of the State of Delaware against certain directors and the chief executive officer of the Company and against the Company, as a nominal defendant.  The complaint alleges claims for breach of fiduciary duty, entrenchment and corporate waste arising out of the alleged failure to conduct annual meetings, SEC filing obligations, advances to a former employee and a $500,000 secured loan to the Company which the entire board of directors approved.  The derivative complaint seeks unspecified compensatory damages and other relief.  The Company and the individual defendants believe that the allegations stated in the complaint are without merit and they intend to defend themselves vigorously against the allegations. The individual director defendants filed a motion to dismiss the complaint on July 22, 2013 and filed an opening brief in support of the motion to dismiss on August 2, 2013.  The Company joined in the motion to dismiss.  Plaintiff’s brief in opposition to the motion to dismiss was due on September 16, 2013.  Instead of filing a brief in opposition to the motion to dismiss, on September 16, 2013, plaintiff filed an amended complaint against the same defendants alleging two claims for breach of fiduciary duty and corporate waste and deleting the claim for entrenchment.  The claims in the amended complaint arise out of allegations regarding a failure to conduct stockholder annual meetings, a failure to comply with SEC filing obligations, a lack of internal controls and unauthorized advances to a former employee and a $500,000 secured loan approved by the Company’s entire board.  The Company and the individual defendants continue to believe the allegations are without merit and intend to vigorously defend themselves against the allegations. On October 3, 2013, the individual director defendants moved to dismiss the amended complaint, and the Company joined in the motion to dismiss.  Under a briefing schedule approved by the court, defendants’ brief on the motion to dismiss is due by November 4, 2013, plaintiff’s answering brief is due by December 13, 2013, and defendants’ reply brief is due by January 10, 2014.
	On May 15, 2013, a former consultant filed suit in Boone County, Kentucky Circuit Court alleging breach of contract and unjust enrichment for unpaid consulting fees and expenses of approximately $27,000.  The Company filed an answer to the complaint on July 22, 2013 and intends to vigorously defend itself against the allegations.
	On August 9, 2013, two shareholders of the Company, HWH Lending, LLC and Milfam I L.P., filed in the Delaware Court of Chancery a verified complaint for injunctive and declaratory relief, seeking to prevent the Company from including a 10.5% block of shares held by a stockholder in the vote count at the Company’s upcoming annual meeting of stockholders scheduled for August 15, 2013.  The complaint alleged that the Company and its Chief Executive Officer did not follow proper procedures in issuing the shares to the stockholder and caused those shares to be issued in violation of Delaware law.  Following an expedited briefing schedule, the court held a hearing on August 14, 2013 and denied plaintiffs’ request for a temporary restraining order.  On August 21, 2013, the plaintiffs filed a notice of voluntary dismissal, dismissing the action without prejudice.
	On October 11, 2013, two former directors of the Company sent a letter demanding payment of $80,766 in legal fees and expenses pursuant to certain Company indemnification and advancement provisions.  The Company is evaluating the demand and has requested additional information.
	In the normal course of business the Company may be involved in legal proceedings, claims and assessments arising in the ordinary course of business. Such matters are subject to many uncertainties, and outcomes are not predictable with assurance. Legal fees for such matters are expensed as incurred and we accrue for adverse outcomes as they become probable and estimable. Currently, other than discussed above, the Company is not involved in any such material matters.
	Settlement Agreement
	On February 22, 2013, the Company entered into a settlement agreement with a counterparty for amounts owed related to the return of expired goods and inventory and the Company wrote down the accounts receivable to the settlement amount as of December 31, 2012. On February 28, 2013, the Company received $50,000 in connection with the agreement in complete satisfaction of all outstanding and past due accounts receivable from the counterparty, such that there was no balance due to the Company as of March 31, 2013.

Concentrations

Concentrations	3 Months Ended
	Mar. 31, 2013
Concentrations
Note 9 - Concentrations	The Company maintains deposits in financial institutions which are insured by the Federal Deposit Insurance Corporation (“FDIC”). At various times, the Company has deposits in these financial institutions in excess of the amount insured by the FDIC.
	As of March 31, 2013, three companies represented approximately 16%, 15% and 14% of accounts receivable.  As of December 31, 2012, two companies represented approximately 18% and 14% of accounts receivable.
	During the three months ended March 31, 2013, two vendors represented 30% and 11% of total inventory purchases. During the three months ended March 31, 2012, one vendor represented 41% of total inventory purchases.

Related_Party_Transactions

Related Party Transactions	3 Months Ended
	Mar. 31, 2013
Related Party Transactions
Note 10 - Related Party Transactions	During the three months ended March 31, 2013 and 2012, a director was paid $0 and $13,800 for general financial and business consulting. Beginning July 1, 2013, the director is to be paid $3,000 per month and is entitled to expense reimbursements as compensation for serving on the Company’s Board committees.
	From March 2011 to April 2013, a wife of a director served as the agent for the Company's D&O insurance. During the three months ended March 31, 2013 and 2012, the Company recorded insurance premium expense of $14,100 and $11,750, respectively.
	See Note 7 – Stockholders’ Deficiency – Common Stock for details regarding the exchange of common stock and warrants in satisfaction of related party notes payable, advances and accounts payable.

Subsequent_Events

Subsequent Events	3 Months Ended
	Mar. 31, 2013
Subsequent Events
Note 11 - Subsequent Events	The Company evaluates events that have occurred after the balance sheet date but before the financial statements are issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the condensed consolidated financial statements, except as disclosed below.
	Private Placement Offerings
	On April 11, 2013, the Company completed private placements for an aggregate of $125,000 for the purchase 125,000 units at a price of $1.00 per unit. Each unit consists of (i) one share of the Company’s common stock, and (ii) a five-year warrant to purchase three shares of the Company’s common stock at an exercise price of $0.25 per share. Substantially all of the proceeds from the sale of the units were used by the Company to satisfy all of its obligations under the Notes and Convertible Notes (see Note 7).
	Warrant Exercises
	Subsequent to March 31, 2013, the Company issued an aggregate of 3,408,147 shares of common stock to holders of warrants who elected to exercise warrants to purchase an aggregate of 4,404,273 shares of common stock on a "cashless" basis under the terms of the warrants. The warrants had exercise prices of $0.25 per share (3,245,925 gross shares), $0.35 per share (750,000 gross shares), and $1.00 per share (408,348 gross shares).
	Option Grants
	On June 19, 2013, the Company granted an option to a director to purchase 100,000 shares of common stock under the 2009 Plan at an exercise price of $1.45 per share for a grant date value of $109,600.  The option vests over a three year period and has a term of ten years.
	Pagosa Health LLC
	On June 4, 2013, the Company formed a wholly owned subsidiary called Pagosa Health LLC (“Pagosa”). On June 7, 2013, Pagosa signed a three year lease for $1,000 per month to house an office, pharmacy as well as inventory and is located in Lawrenceburg, Indiana. A redundant facility is required by Verified Internet Pharmacy Practice Sites (“VIPPS”) and a newly acquired contract.  Pagosa will serve as a backup facility and will function as a closed door pharmacy. On July 8, 2013, the parties agreed to extend the lease for two additional years, such that the new termination date is now June 7, 2018.
	Related Party Advances
	Subsequent to March 31, 2013, an officer advanced approximately $2,000 to the Company and he was repaid approximately $60,000. As of March 31, 2013, the outstanding payable to the officer was approximately $154,000.
	Notes Payable
	On August 15, 2013, the Company issued a note payable to a related party with a principal balance of $49,000, bearing interest at a rate of 10% per annum.  The note has a maturity date of November 7, 2013 and will be repaid in weekly payments of principal and interest beginning in September 2013.
	Effective September 30, 2013, the Company entered into an Amended and Restated Promissory Note (the “September Note”) which supersedes the March Note (see Note 6 – Notes Payable) with the same Lender.  The Company borrowed an additional $100,000 from the Lender, which brought the face value of the September Note to $600,000.  The September Note contains financial covenants which require the Company to meet certain minimum targets for earnings before interest, taxes and non-cash expenses, including depreciation, amortization and stock-based compensation (“EBITDAS”) for the calendar quarters and years ended between December 31, 2013 and 2014, inclusive. In addition, the September Note extended the deadline for providing the March 31, 2013 and June 30, 2013 quarterly financial statements and financial covenant certifications from 45 days after quarter end to October 31, 2013. The remainder of the material September Note terms are unchanged from the March Note.  In consideration of the Lender providing additional funds and entering into the September Note, the Company granted the Lender a five-year warrant to purchase 150,000 shares of common stock at an exercise price of $0.35 per share. The warrant contains customary anti-dilution provisions. The warrant had a relative fair value of $51,200 which was set up as debt discount and will be amortized using the effective interest method over the term of the September Note.  Including the value of the warrants issued in connection with the March Note and September Note, the September Note had an effective interest rate of 41% per annum.
	Sublease Agreement
	On October 10, 2013, the Company entered into a sublease agreement for 15,000 square feet of warehouse space at the Company’s corporate headquarters in Florence, Kentucky. The initial term of the sublease expires on January 31, 2014 with rent of $4,688 per month. After the expiration of the initial term, the tenant may extend the term of the sublease agreement on a month to month basis.

Summary_of_Significant_Account1

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2013
Summary Of Significant Accounting Policies Policies
Principles of Consolidation	Principles of Consolidation
	The condensed consolidated financial statements include the accounts of HealthWarehouse.com, Inc., Hwareh.com, Inc., Hocks.com, Inc., ION Holding NV, and ION Belgium NV, its wholly-owned subsidiaries. ION Holding NV and ION Belgium NV are inactive subsidiaries. All material inter-company balances and transactions have been eliminated in consolidation.
Use of Estimates	Use of Estimates
	The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.  The Company’s significant estimates include reserves related to accounts receivable and inventory, the recoverability and useful lives of long-lived assets, the valuation allowance related to deferred tax assets, the valuation of equity instruments and debt discounts.
Reclassifications	Reclassifications
	Certain accounts in the prior period condensed consolidated financial statements have been reclassified for comparison purposes to conform to the presentation of the current period condensed consolidated financial statements.  These reclassifications had no effect on the previously reported net loss.
Revenue Recognition	Revenue Recognition
	Revenues for the sales of products are recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed and determinable and collectability is reasonably assured. The Company defers revenue when cash has been received from the customer but delivery has not yet occurred.  Such amounts are reflected as deferred revenues in the accompanying condensed consolidated financial statements.
Net Loss Per Share of Common Stock	Net Loss Per Share of Common Stock
	Basic net loss per share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period.  Diluted net loss per share reflects the potential dilution that could occur if securities or other instruments to issue common stock were exercised or converted into common stock.  Potentially dilutive securities are excluded from the computation of diluted net loss per share if their inclusion would be anti-dilutive and consist of the following:
		March 31,
		2013		2012
	Options		2,451,483		2,033,807
	Warrants		6,047,119		2,916,590
	Series B Convertible Preferred Stock		3,407,313		1,973,425
	Convertible Promissory Notes		-		529,100
	Total potentially dilutive shares		11,905,915		7,452,922
Stock-Based Compensation	Stock-Based Compensation
	Stock-based compensation expense for all stock-based payment awards is based on the estimated fair value of the award. For employees and directors, the award is measured on the grant date.  For non-employees, the award is measured on the grant date and is then remeasured at each vesting date and financial reporting date.  The Company recognizes the estimated fair value of the award as compensation cost over the requisite service period of the award, which is generally the option vesting term.  The Company generally issues new shares of common stock to satisfy option and warrant exercises.
Recently Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements
	In July 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2013-11, “Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists." This ASU addresses the requirements regarding the financial statement presentation of an unrecognized tax benefit within Accounting Standards Codification ("ASC") Topic 740 for the purpose of providing consistency between the financial reporting of U.S. GAAP entities. Generally, this ASU provides guidance for the preparation of financial statements and disclosures when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists.  This ASU is effective for periods beginning after December 15, 2013 and is not expected to have any impact on the Company’s condensed consolidated financial statements or disclosures.

Summary_of_Significant_Account2

Summary of Significant Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2013
Summary Of Significant Accounting Policies Tables
Schedule of Potentially Dilutive Securities	Potentially dilutive securities are excluded from the computation of diluted net loss per share if their inclusion would be anti-dilutive and consist of the following:
		March 31,
		2013		2012
	Options		2,451,483		2,033,807
	Warrants		6,047,119		2,916,590
	Series B Convertible Preferred Stock		3,407,313		1,973,425
	Convertible Promissory Notes		-		529,100
	Total potentially dilutive shares		11,905,915		7,452,922

Accrued_Expenses_and_Other_Cur1

Accrued Expenses and Other Current Liabilities (Tables)	3 Months Ended
	Mar. 31, 2013
Accrued Expenses And Other Current Liabilities Tables
Accrued expenses and other current liabilities	Accrued expenses and other current liabilities consisted of the following:
		March 31,		December 31,
		2013		2012
	Deferred rent	$	40,889	$	39,100
	Advertising		75,000		75,000
	Salaries and benefits		220,075		166,118
	Professional fees		50,000		81,872
	Dividends payable		69,840		261,084
	Accrued interest		44,250		410,101
	Due to investors (1)		125,000		850,002
	Customer payables		59,018		51,333
	Other		16,186		8,159
	Total	$	700,258	$	1,942,769

Stockholders_Deficiency_Tables

Stockholders' Deficiency (Tables)	3 Months Ended
	Mar. 31, 2013
Stockholders Deficiency Tables
Schedule of Stock Options Granted	In applying the Black-Scholes option pricing model to stock options granted, the Company used the following weighted average assumptions:
		For The Three Months Ended
		March 31,
		2013			2012
	Risk free interest rate		1.13	%		1.04	%
	Dividend yield		0	%		0	%
	Expected volatility		166	%		172.2	%
	Expectd life in years		6			6
Summary of Stock Option Activity	A summary of the stock option activity during the three months ended March 31, 2013 is presented below:
								Weighted
					Weighted			Average
		Number			Average			Remaining
		of			Exercise			Life		Intrinsic
		Options			Price			In Years		Value
	Outstanding, January 1, 2013		2,183,899		$	3.42
	Granted		330,500			1.6
	Exercised		-			-
	Forfeited		(62,916	)		3.11
	Outstanding, March 31, 2013		2,451,483		$	3.18			6.2	$	77,331
	Exercisable, March 31, 2013		1,192,649		$	2.66			4.7	$	77,331
Summary of Stock Option Outstanding and Exercisable	The following table presents information related to stock options at March 31, 2013:
		Options Outstanding			Options Exercisable
		Weighted			Weighted		Weighted
	Range of	Average		Outstanding	Average		Average	Exercisable
	Exercise	Exercise		Number of	Exercise		Remaining Life	Number of
	Price	Price		Options	Price		In Years	Options
	$0.80 - $2.20	$         1.59		806,400	$         1.58		2.5	485,900
	$2.21 - $3.80	3.19		924,083	2.91		5.6	510,083
	$3.81 - $6.99	4.94		721,000	4.65		8.1	196,666
		$         3.18		2,451,483	$         2.66		4.7	1,192,649
Schedule of Stock Warrants Granted	In applying the Black-Scholes option pricing model to stock warrants granted, the Company used the following weighted average assumptions:
		For The Three Months Ended
		March 31,
		2013			2012
	Risk free interest rate		0.88	%		n/a
	Dividend yield		0	%		n/a
	Expected volatility		164.3	%		n/a
	Expectd life in years		5			n/a
Summary of Stock Warrant Activity	A summary of the stock warrant activity during the three months ended March 31, 2013 is presented below:
								Weighted
					Weighted			Average
					Average			Remaining
		Number of			Exercise			Life		Intrinsic
		Warrants			Price			In Years		Value
	Outstanding, January 1, 2013		592,846		$	3.01
	Granted		13,580,023			0.28
	Exercised		(8,125,750	)		0.25
	Forfeited		-			-
	Outstanding, March 31, 2013		6,047,119		$	0.58			4.7	$	4,618,507
	Exercisable, March 31, 2013		5,767,119		$	0.46			4.8	$	4,618,507
Summary of Stock Warrants Outstanding and Exercisable	The following table presents information related to stock warrants at March 31, 2013:
		Warrants Outstanding			Warrants Exercisable
		Weighted			Weighted		Weighted
	Range of	Average		Outstanding	Average		Average	Exercisable
	Exercise	Exercise		Number of	Exercise		Remaining Life	Number of
	Price	Price		Warrants	Price		In Years	Warrants
	$0.25 - $0.35	$        0.26		5,045,925	$        0.26		4.9	5,045,925
	$0.36 - $1.60	1.00		408,348	1.00		4.9	408,348
	$1.61 - $3.00	2.91		562,846	2.91		3.4	312,846
	$3.01 - $4.95	4.95		30,000	-		-	-
		$        0.58		6,047,119	$        0.46		4.8	5,767,119

Going_Concern_and_Managements_1

Going Concern and Management's Liquidity Plans (Details Narrative) (USD $)	3 Months Ended		12 Months Ended
	Mar. 31, 2013	Mar. 31, 2012	Dec. 31, 2012
Going Concern And Managements Liquidity Plans Details Narrative
Working Capital Deficiency	$3,909,308
Accumulated deficit	26,509,602		20,828,674
Net Losses	4,078,366	1,550,312	5,574,775
Net Cash Used in Operating Activities	$457,373	$177,395	$947,911

Summary_of_Significant_Account3

Summary of Significant Accounting Policies (Details) (USD $)	Mar. 31, 2013	Mar. 31, 2012
Summary Of Significant Accounting Policies Details
Options	$2,451,483	$2,033,807
Warrants	6,047,119	2,916,590
Series B Convertible Preferred Stock	3,407,313	1,973,425
Convertible Promissory Notes		529,100
Total potentially dilutive shares	$11,905,915	$7,452,922

Accrued_Expenses_and_Other_Cur2

Accrued Expenses and Other Current Liabilities (Details) (USD $)	Mar. 31, 2013	Dec. 31, 2012
Accrued Expenses And Other Current Liabilities Details
Deferred rent	$40,889	$39,100
Advertising	75,000	75,000
Salaries and benefits	220,075	166,118
Professional fees	50,000	81,872
Dividends payable	69,840	261,084
Accrued interest	44,250	410,101
Due to investors (1)	125,000	850,002
Customer payables	59,018	51,333
Other	16,186	8,159
Total	$700,258	$1,942,769

Convertible_Notes_Payable_Deta

Convertible Notes Payable (Details Narrative) (USD $)	Mar. 31, 2013
Convertible Notes Payable Details Narrative
Convertible Notes Payable	$82,616

Notes_Payable_Details_Narrativ

Notes Payable (Details Narrative) (USD $)	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Notes Payable Details Narrative
Notes payable	$44,363	$133,095

Stockholders_Deficiency_Detail

Stockholders' Deficiency (Details)	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Stockholders Deficiency Details
Risk free interest rate	1.13%	1.04%
Dividend yield	0.00%	0.00%
Expected volatility	166.00%	172.20%
Expectd life in years	6 years	6 years

Stockholders_Deficiency_Detail1

Stockholders' Deficiency (Details 1) (USD $)	3 Months Ended
	Mar. 31, 2013
Number of options, outstanding
Outstanding, beginning of period (in shares)	2,183,899
Granted	330,500
Exercised
Forfeited	-62,916
Outstanding, end of period (in shares)	2,451,483
Exercisable, March 31, 2013	1,192,649
Options, weighted average exercise price
Outstanding, beginning of period (in dollars per share)	$3.42
Granted	$1.60
Exercised
Forfeited	$3.11
Outstanding, end of period (in dollars per share)	$3.18
Exercisable, March 31, 2013	$2.66
Weighted Average Remaining Life In Years
Weighted Average Remaining Life (in years) Outstanding	6 years 2 months 12 days
Weighted Average Remaining Life (in years) Exercisable	4 years 8 months 12 days
Aggregate Intrinsic Value Outstanding	$77,331
Aggregate Intrinsic Value Exercisable	$77,331

Stockholders_Deficiency_Detail2

Stockholders' Deficiency (Details 2) (USD $)	Mar. 31, 2013	Dec. 31, 2012
Number Outstanding	2,451,483	2,183,899
Weighted Average Exercise Price Outstanding	$3.18	$3.42
Number Exercisable	1,192,649
Weighted Average Exercise Price Exercisable	$2.66
Weighted Average Remaining Years of Contractual Life	4 years 8 months 12 days
$0.80-2.20
Number Outstanding	806,400
Weighted Average Exercise Price Outstanding	$1.59
Number Exercisable	485,900
Weighted Average Exercise Price Exercisable	$1.58
Weighted Average Remaining Years of Contractual Life	2 years 6 months
$2.21-3.80
Number Outstanding	924,083
Weighted Average Exercise Price Outstanding	$3.19
Number Exercisable	510,083
Weighted Average Exercise Price Exercisable	$2.91
Weighted Average Remaining Years of Contractual Life	5 years 7 months 6 days
$3.81-6.99
Number Outstanding	721,000
Weighted Average Exercise Price Outstanding	$4.94
Number Exercisable	196,666
Weighted Average Exercise Price Exercisable	$4.65
Weighted Average Remaining Years of Contractual Life	8 years 1 month 6 days

Stockholders_Deficiency_Detail3

Stockholders' Deficiency (Details 3)	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Stockholders Deficiency Details 3
Risk free interest rate	0.88%
Dividend yield	0.00%
Expected volatility	164.30%
Expectd life in years	5 years	0 years

Stockholders_Deficiency_Detail4

Stockholders' Deficiency (Details 4) (USD $)	3 Months Ended
	Mar. 31, 2013
Number of warrants, outstanding
Outstanding, beginning of period (in shares)	592,846
Granted	13,580,023
Exercised	-8,125,750
Forfeited
Outstanding, end of period (in shares)	6,047,119
Exercisable, March 31, 2013	5,767,119
Warrants, weighted average exercise price
Outstanding, beginning of period (in dollars per share)	$3.01
Granted	$0.28
Exercised	$0.25
Forfeited
Outstanding, end of period (in dollars per share)	$0.58
Exercisable, March 31, 2013	$0.46
Weighted Average Remaining Life In Years
Weighted Average Remaining Life (in years) Outstanding	4 years 8 months 12 days
Weighted Average Remaining Life (in years) Exercisable	4 years 9 months 18 days
Aggregate Intrinsic Value
Aggregate Intrinsic Value Outstanding	$4,618,507
Aggregate Intrinsic Value Exercisable	$4,618,507

Stockholders_Deficiency_Detail5

Stockholders' Deficiency (Details 6) (USD $)	Mar. 31, 2013
Number Outstanding	6,047,119
Weighted Average Remaining Contractual Term	4 years 9 months 18 days
Weighted Average Exercise Price Outstanding	$0.58
Number Exercisable	5,767,119
Weighted Average Exercise Price Exercisable	$0.46
$0.25 - $0.35
Number Outstanding	5,045,925
Weighted Average Remaining Contractual Term	4 years 10 months 24 days
Weighted Average Exercise Price Outstanding	$0.26
Number Exercisable	5,045,925
Weighted Average Exercise Price Exercisable	$0.26
$0.36 - $1.60
Number Outstanding	408,348
Weighted Average Remaining Contractual Term	4 years 10 months 24 days
Weighted Average Exercise Price Outstanding	$1
Number Exercisable	408,348
Weighted Average Exercise Price Exercisable	$1
$1.61 - $3.00
Number Outstanding	562,846
Weighted Average Remaining Contractual Term	3 years 4 months 24 days
Weighted Average Exercise Price Outstanding	$2.91
Number Exercisable	312,846
Weighted Average Exercise Price Exercisable	$2.91
$3.01 - $4.95
Number Outstanding	30,000
Weighted Average Exercise Price Outstanding	$4.95
Number Exercisable
Weighted Average Exercise Price Exercisable

Stockholders_Deficiency_Detail6

Stockholders' Deficiency (Details Narrative) (USD $)	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012	Dec. 31, 2012
Aggregate Shares	3,376,975
Shares Price	1.00%
Beneficial Conversion Feature	$202,305
Preferred Stock Outstanding	1,000,000	65,271	1,000,000
Deemed Dividends		92,916
Preferred Stock Dividends	7.00%
Common Stock Issuable	1,295,738
Beneficial Conversion Feature Related to Incremental Shares	1,330,417
Stock-Based Compensation Expense	330,021	259,409
Common Stock Warrant Issued	6,934,784
Warrants Exercise Purchase	8,125,750
Warrants Exercise Price Per Share	$0.25
Salary expense	87,500
Series C Preferred Stock
Deemed Dividends	92,916
Stock Options [Member]
Weighted Average Fair Value	$1.20	$5.27
Selling, General And Administrative Expenses	312,444	259,409
Stock-Based Compensation Expense	2,916,160
Weighted Average Remaining Period	2 years 3 months 18 days
Stock Warrants [Member]
Weighted Average Fair Value	$1.38	$0
Selling, General And Administrative Expenses	504,777	0
Stock-Based Compensation Expense	$674,312
Weighted Average Remaining Period	2 years 6 months
Warrants Exercise Purchase	11,840,859

Commitments_and_Contingent_Lia1

Commitments and Contingent Liabilities (Details Narrative) (USD $)	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Commitments And Contingent Liabilities Details Narrative
Rent Expense	$45,719	$52,457

Concentrations_Details_Narrati

Concentrations (Details Narrative)	3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended	3 Months Ended
	Mar. 31, 2013	Dec. 31, 2012	Mar. 31, 2013	Dec. 31, 2012	Mar. 31, 2013	Mar. 31, 2013	Mar. 31, 2012	Mar. 31, 2013
	Customer 1 [Member]	Customer 1 [Member]	Customer 2 [Member]	Customer 2 [Member]	Customer 3 [Member]	Vendor 1 [Member]	Vendor 1 [Member]	Vendor 2 [Member]
Concentration Percentage	16.00%	18.00%	15.00%	14.00%	14.00%	30.00%	41.00%	11.00%

Related_Party_Transactions_Det

Related Party Transactions (Details Narrative) (USD $)	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Related Party Transactions Details Narrative
General financial and business consulting	$0	$13,800
Insurance Premium Expense	$14,100	$11,750