HealthWarehouse.com (HEWA) 10-Q 12 May 16 2016 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2016	May. 10, 2016
Document And Entity Information
Entity Registrant Name	HealthWarehouse.com, Inc.
Entity Central Index Key	754,813
Document Type	10-Q
Document Period End Date	Mar. 31, 2016
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		37,693,404
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2,016

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Mar. 31, 2016	Dec. 31, 2015
Current assets:
Cash	$ 24,866	$ 11,217
Restricted cash	115,088	145,088
Accounts receivable, net of allowance of $47,143 as of March 31, 2016 and December 31, 2015	64,521	51,627
Inventories - finished goods, net	241,642	182,647
Prepaid expenses and other current assets	85,423	81,718
Total current assets	531,540	472,297
Property and equipment, net of accumulated depreciation of $827,528 and $801,270 as of March 31, 2016 and December 31, 2015	382,990	409,248
Web development costs, net of accumulated amortization of $165,699 and $146,448 as of March 31, 2016 and December 31, 2015	65,311	84,562
Total assets	979,841	966,107
Current liabilities:
Accounts payable - trade	2,310,300	2,189,649
Accounts payable - related parties	260	862
Accrued expenses and other current liabilities	347,844	597,665
Current portion of equipment lease payable	29,349	46,143
Notes payable and other advances, net of debt discount of $12,056 and $0 as of March 31, 2016 and December 31, 2015, respectively	1,087,944	991,089
Note payable and other advances - related parties	16,058	23,889
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, 2016 and December 31, 2015 (aggregate liquidation preference of $1,000,000)	1,000,000	1,000,000
Total current liabilities	4,791,755	4,849,297
Total liabilities	$ 4,791,755	$ 4,849,297
Stockholders' deficiency:
Preferred stock - par value $0.001 per share; authorized 1,000,000 shares; issued and outstanding as of March 31, 2016 and December 31, 2015 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; 517,359 and 483,512 shares issued and outstanding as of March 31, 2016 and December 31, 2015, respectively (aggregate liquidation preference of $4,974,601 and $4,889,043 as of March 31, 2016 and December 31, 2015, respectively)	$ 517	$ 484
Common stock - par value $0.001 per share; authorized 100,000,000 shares; 38,844,374 shares issued and 37,665,162 shares outstanding as of March 31, 2016 and December 31, 2015	38,844	38,844
Additional paid-in capital	31,067,056	30,656,598
Treasury stock, at cost, 1,179,212 shares as of March 31, 2016 and December 31, 2015	(3,419,715)	(3,419,715)
Accumulated deficit	(31,498,616)	(31,159,401)
Total stockholders' deficiency	(3,811,914)	(3,883,190)
Total liabilities and stockholders' deficiency	$ 979,841	$ 966,107

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Mar. 31, 2016	Dec. 31, 2015
Current liabilities:
Accounts receivable, net of allowance	$ 47,143	$ 47,143
Property and equipment, net of accumulated depreciation	827,528	801,270
Web development costs, net of accumulated amortization	165,699	146,448
Current portion of notes payable, net of debt discount	$ 12,056	$ 0
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
Stockholders' deficiency:
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, authorized	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	517,359	483,512
Series B Convertible preferred stock, shares outstanding	517,359	483,512
Series B Convertible preferred stock, aggregate liquidation preference	$ 4,974,601	$ 4,889,043
Common stock, par value	$ 0.001	$ 0.001
Common stock, authorized	100,000,000	100,000,000
Common stock, shares issued	38,844,374	38,844,374
Common stock, shares outstanding	37,665,162	37,665,162
Treasury stock, shares	1,179,212	1,179,212

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Consolidated Statements Of Operations
Net sales	$ 2,347,798	$ 1,612,677
Cost of sales	891,820	631,163
Gross profit	1,455,978	981,514
Operating expenses:
Selling, general and administrative expenses	1,683,716	1,107,550
Net loss from operations	(227,738)	(126,036)
Other expense:
Interest expense	(25,919)	(74,752)
Total other expense	(25,919)	(74,752)
Net loss	(253,657)	(200,788)
Preferred stock:
Series B convertible contractual dividends	(85,558)	(79,961)
Net loss attributable to common stockholders	$ (339,215)	$ (280,749)
Per share data:
Net loss - basic and diluted	$ (0.01)	$ (0.01)
Series B convertible contractual dividends	0	0
Net loss attributable to common stockholders - basic and diluted	$ (0.01)	$ (0.01)
Weighted average number of common shares outstanding - basic and diluted	37,665,162	37,570,383

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2015
Cash flows from operating activities
Net loss	$ (253,657)	$ (200,788)	$ (626,682)
Adjustments to reconcile net loss to net cash used in operating activities:
Provision for doubtful accounts		90
Provision for employee advance reserve		2,143
Depreciation and amortization	$ 45,509	45,661
Stock-based compensation	$ 75,138	79,005
Gain on settlement of accounts payable		(66,179)
Amortization of debt discount	$ 3,444	54,517
Changes in operating assets and liabilities:
Accounts receivable	(12,894)	(11,558)
Inventories - finished goods	(58,995)	(1,034)
Prepaid expenses and other current assets	(3,705)	12,857
Accounts payable - trade	120,651	(65,472)
Accounts payable - related parties	(602)	(382)
Accrued expenses and other current liabilities	(15,526)	(57,168)
Net cash used in operating activities	(100,637)	$ (208,308)	(548,281)
Cash flows from investing activities
Change in restricted cash	$ 30,000
Capital expenditures		$ (5,539)
Website development costs		(10,942)
Net cash provided by (used in) investing activities	$ 30,000	(16,481)
Cash flows from financing activities
Principal payments on equipment leases payable	(16,794)	$ (15,382)
Proceeds from issuance of notes payable	108,911
Repayment of notes payable	(7,831)
Net cash provided by (used in) financing activities	84,286	$ (15,382)
Net increase (decrease) in cash	13,649	(240,171)
Cash - beginning of period	11,217	506,019	506,019
Cash - end of period	24,866	265,848	$ 11,217
Cash paid for:
Interest	22,474	19,544
Non-cash investing and financing activities:
Issuance of Series B preferred stock for settlement of accrued dividends	319,853	298,918
Warrants issued as debt discount in connection with notes payable	15,500	41,300
Accrual of contractual dividends on Series B convertible preferred stock	$ 85,558	$ 79,961

Organization and Basis of Prese

Organization and Basis of Presentation	3 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
1. Organization and Basis of Presentation	HealthWarehouse.com, Inc. ("HEWA" or the "Company"), a Delaware company incorporated in 1998, is an online mail order pharmacy, licensed in 50 states and the District of Columbia to focus on the out-of-pocket prescription drug market. The Company is Verified Internet Pharmacy Practice Site ("VIPPS") accredited by the National Association of Boards of Pharmacy ("NABP"). The Company markets a complete range of generic, brand name, and pet prescription medications as well as over-the-counter ("OTC") medications and products. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information. Accordingly, they do not include all of the information and disclosures required by U.S. 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, 2016 and for the three months ended March 31, 2016 and 2015. The results of operations for the three months ended March 31, 2016 are not necessarily indicative of the operating results for the full year ending December 31, 2016 or any other period. 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, 2015 and for the year then ended, which were filed with the Securities and Exchange Commission on Form 10-K on March 25, 2016.

Going Concern and Management's

Going Concern and Management's Liquidity Plans	3 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
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, 2016, the Company had a working capital deficiency of $4,260,215 and an accumulated deficit of $31,498,616. During the three months ended March 31, 2016 and the year ended December 31, 2015, the Company incurred net losses of $253,657 and $626,682, respectively and used cash in operating activities of $100,637 and $548,281, respectively. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Subsequent to March 31, 2016, the Company continues to incur net losses, use cash in operating activities and experience cash and working capital constraints. The Company is subject to a 2013 Notice of Redemption related to its Series C Redeemable Preferred Stock aggregating $1,000,000, whereby 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 U.S. 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 Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
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 U.S. 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. Net Earnings (Loss) Per Share of Common Stock Basic net earnings (loss) per share is computed by dividing net earnings (loss) attributable to Common Stockholders by the weighted average number of common shares outstanding during the period. Diluted net earnings (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 earnings (loss) per share if their inclusion would be anti-dilutive and consist of the following: March 31, 2016 2015 Options 5,381,205 3,944,557 Warrants 10,121,198 9,839,044 Series B Convertible Preferred Stock 5,892,720 5,507,202 Total potentially dilutive shares 21,395,123 19,290,803

Accrued Expenses and Other Curr

Accrued Expenses and Other Current Liabilities	3 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
4. Accrued Expenses and Other Current Liabilities	Accrued expenses and other current liabilities consisted of the following: March 31, 2016 December 31, 2015 Deferred Rent $ 19,389 $ 25,852 Advertising 76,639 76,639 Salaries and Benefits 58,937 64,007 Dividend Payable 85,558 319,854 Accrued Interest 44,249 44,249 Accrued Rent 50,078 49,614 Other 12,994 17,450 Total $ 347,844 $ 597,665

Notes Payable

Notes Payable	3 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
5. Notes Payable	The Company is a party to a Loan and Security Agreement (the "Loan Agreement") with a lender (the "Lender"). Under the terms of the Loan Agreement, the Company borrowed an aggregate of $1,000,000 from the Lender (the "Loan"). The Loan is evidenced by a promissory note (the "Senior Note") in the face amount of $1,000,000 (as amended). The Senior Note bears interest on the unpaid principal balance of the 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 (7.75% as of March 31, 2016). 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. The principal amount and all unpaid accrued interest on the Note is payable on May 31, 2016, 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 Senior 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"). 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, including a Deposit Account Control Agreement, which grants the Lender a security interest in certain bank accounts. On January 11, 2016, the Company entered into an Amendment to Promissory Note in the face amount of $100,000 with a different lender, effective October 31, 2015, which extended the maturity date of the note payable from November 1, 2015 to October 31, 2016. In consideration of the extension of the maturity date of the note payable, the Company issued to the lender a five-year warrant to purchase 75,000 shares of Common Stock at an exercise price of $0.25 per share. The warrants had a fair value of $15,500 using the Black-Scholes model (see note 6) which was established as debt discount during the three months ended March 31, 2016 and will be amortized using the effective interest method over the remaining term of the Promissory Note. Including the value of the warrants issued in connection with the extension of the maturity date of the Promissory Note, the Promissory Note has an effective interest rate of 23% per annum during the extension period. The Company recorded amortization of debt discount associated with notes payable of $3,444 and $54,517 for the three months ended March 31, 2016 and 2015, respectively.

Stockholders' Deficiency

Stockholders' Deficiency	3 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
6. Stockholders' Deficiency	Preferred Stock As of March 31, 2016 and December 31, 2015, the Company had accrued contractual dividends of $85,558 and $319,853, respectively, related to the Series B Preferred Stock. On January 1, 2016 and 2015, the Company issued 33,847 and 31,633 shares of Series B convertible preferred stock valued at approximately $320,000 and $299,000, respectively, representing approximately $0.66 in value per share of Series B Preferred Stock outstanding on each date, to the Series B convertible preferred stock holders as payment in kind for dividends. Stock Options Valuation In applying the Black-Scholes option pricing model to stock options, the Company used the following weighted average assumptions: For The Three Months Ended March 31, 2016 2015 Risk free interest rate 1.63% to 2.12% n/a Dividend yield 0.00% n/a Expected volatility 199% to 200.0% n/a Expected life in years 5.5 to 10.0 n/a Grants The weighted average fair value of the stock options granted during the three months ended 31, 2016 was $0.24 per share. There were no stock options granted during the three months March 31, 2015. During the three months ended March 31, 2016, the Company granted options to consultants and directors of the Company to purchase an aggregate of 172,254 shares of common stock under a previously approved plan at exercise prices ranging between $0.24 and $0.25 per share for an aggregate grant date value of $41,379. The options vested on the grant date and have a term of ten years. Stock-based compensation expense related to stock options was recorded in the condensed consolidated statements of operations as a component of selling, general and administrative expenses and totaled $75,138 and $78,789 for the three months ended March 31, 2016 and 2015, respectively. As of March 31, 2016, stock-based compensation expense related to stock options of $996,064 remains unamortized, including $104,495 which is being amortized over the weighted average remaining period of 2.0 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. Summary A summary of the stock option activity during the three months ended March 31, 2016 is presented below: Weighted Average Average Remaining Aggregate Number of Exercise Life Intrinsic Options Price In Years Value Outstanding, January 1, 2016 5,341,284 $ 0.70 Granted 172,254 0.24 Exercised - - Forfeited (132,333 ) 0.49 Outstanding, March 31, 2016 5,381,205 $ 0.69 7.6 $ 332,554 Exercisable, March 31, 2016 4,169,539 $ 0.62 7.6 $ 240,254 The following table presents information related to stock options at March 31, 2016: 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 $ 0.09 - $2.20 $ 0.23 4,701,705 $ 0.25 8.0 3,740,039 $ 2.21 - $3.80 3.35 492,500 2.88 3.8 242,500 $ 3.81 - $6.99 5.17 187,000 5.17 5.4 187,000 $ 0.69 5,381,205 $ 0.62 7.6 4,169,539 Warrants Valuation In applying the Black-Scholes option pricing model to stock warrants, the Company used the following weighted average assumptions: For The Three Months Ended March 31, 2016 2015 Risk free interest rate 1.58% 1.50% Dividend yield 0.00% 0.00% Expected volatility 200.0% 196.0% Contractual term in years 5.00 5.00 Grants The weighted average fair value of the stock warrants granted during the three months ended March 31, 2016 and 2015, was $0.24 and $0.08 per share, respectively. Stock-based compensation expense related to warrants for the three months ended March 31, 2016 and 2015 was recorded in the condensed consolidated statements of operations as a component of selling, general and administrative expenses and totaled $0 and $216, respectively. As of March 31, 2016, stock-based compensation expense related to warrants of $576,840 remains unamortized. 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, 2016 is presented below: Weighted Average Average Remaining Aggregate Number of Exercise Life Intrinsic Warrants Price In Years Value Outstanding, January 1, 2016 10,046,198 $ 0.41 Granted 75,000 0.25 Exercised - - Forfeited - - Outstanding, March 31, 2016 10,121,198 $ 0.40 3.1 $ 150,922 Exercisable, March 31, 2016 9,871,198 $ 0.34 3.1 $ 150,922 The following table presents information related to stock warrants at March 31, 2016: 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 $ 0.10 - $0.35 $ 0.25 9,571,198 $ 0.25 3.2 9,571,198 $ 0.36 - $3.00 2.90 520,000 2.90 0.5 270,000 $ 3.01 - $4.95 4.95 30,000 4.95 1.5 30,000 $ 0.10 - $4.95 $ 0.40 10,121,198 $ 0.33 3.1 9,871,198

Commitments and Contingent Liab

Commitments and Contingent Liabilities	3 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
7. Commitments and Contingent Liabilities	Operating Leases The Company is a party to a lease agreement for approximately 28,500 square feet of office and storage space with an entity. On March 15, 2016, the Company entered into an amendment of the lease agreement which extended the lease for an additional three years. The amended monthly lease rate will be $5,462 in 2016, $6,649 in 2017, $6,886 in 2018 and $7,124 in 2019. The lease expires on December 31, 2019. The Company accounts for rent expense using the straight line method of accounting, deferring the difference between actual rent due and the straight line amount. Deferred rent payable of $19,389 and $25,852 as of March 31, 2016 and December 31, 2015, respectively, has been included in accrued expenses and other current liabilities on the condensed consolidated balance sheets. 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, IN. 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. On January 14, 2014, the Company closed Pagosa Health and vacated the Lawrenceburg facility. The Company is currently in discussions with the Landlord regarding termination of the lease related to the building. The present value of the remaining lease payments of $50,078 is reflected as a component of accrued expenses and other liabilities on the condensed consolidated financial statements as of March 31, 2016. Future minimum payments, by year and in the aggregate, under operating leases as of March 31, 2016 are as follows: For years ending December 31, Amount 2016 $ 58,152 2017 91,783 2018 87,633 2019 85,482 Total future minimum lease payments $ 323,050 During the three months ended March 31, 2016 and 2015, the Company recorded aggregate rent expense of $20,274 and $18,342 (net of sub-lease), respectively. Litigation In the ordinary course of business, we may become subject to lawsuits and other claims and proceedings that might arise from litigation matters or regulatory audits. Such matters are subject to uncertainty and outcomes are often not predictable with assurance. Our management does not presently expect that any such matters will have a material adverse effect on the Company's condensed consolidated financial condition or condensed consolidated results of operations. We are not currently involved in any pending or threatened material litigation or other material legal proceedings nor have we been made aware of any penalties from regulatory audits.

Concentrations

Concentrations	3 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
8. Concentrations	During the three months ended March 31, 2016, three vendors represented 49%, 16% and 15% of total inventory purchases. During the three months ended March 31, 2015, two vendors represented 74% and 10% of total inventory purchases, respectively. Two vendors represented 40% and 12% of the accounts payable balance as of March 31, 2016. Two vendors represented 43% and 13% of the accounts payable balance as of December 31, 2015.

Subsequent Events

Subsequent Events	3 Months Ended
	Mar. 31, 2016
Notes to Financial Statements
9. 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. Stock Option Grants On April 8, 2016, the Company granted options to directors of the Company to purchase an aggregate of 94,848 shares of common stock under a previously approved plan at an exercise price of $0.29 per share for an aggregate grant date value of $27,000. The options vested on the grant date and have a term of ten years. The options were granted as part of director compensation approved by the Compensation Committee. Common Stock Issued On May 3, 2016, the Company issued 28,242 shares of common stock to an investor as a result of a cashless exercise of warrants. Employment Agreement On May 9, 2016, the Company entered into an employment agreement (the "Employment Agreement") with Mr. Lalit Dhadphale. The terms of the Employment Agreement include a term of two years beginning on January 1, 2016 with an extension provision, the titles and positions of Chief Executive Officer and President, an initial base salary of $175,000 per year, subject to certain bonus and severance provisions. Mr. Dhadphale's agreement is bound by restrictive covenants regarding disclosure of confidential information, non-solicitation and employee non-competition.

Summary of Significant Accoun15

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2016
Summary Of Significant Accounting Policies 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 U.S. 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.
Net Earnings (Loss) Per Share of Common Stock	Basic net earnings (loss) per share is computed by dividing net earnings (loss) attributable to Common Stockholders by the weighted average number of common shares outstanding during the period. Diluted net earnings (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 earnings (loss) per share if their inclusion would be anti-dilutive and consist of the following: March 31, 2016 2015 Options 5,381,205 3,944,557 Warrants 10,121,198 9,839,044 Series B Convertible Preferred Stock 5,892,720 5,507,202 Total potentially dilutive shares 21,395,123 19,290,803

Summary of Significant Accoun16

Summary of Significant Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2016
Summary Of Significant Accounting Policies Tables
Schedule of Potentially Dilutive Securities	March 31, 2016 2015 Options 5,381,205 3,944,557 Warrants 10,121,198 9,839,044 Series B Convertible Preferred Stock 5,892,720 5,507,202 Total potentially dilutive shares 21,395,123 19,290,803

Accrued Expenses and Other Cu17

Accrued Expenses and Other Current Liabilities (Tables)	3 Months Ended
	Mar. 31, 2016
Accrued Expenses And Other Current Liabilities Tables
Accrued expenses and other current liabilities	March 31, 2016 December 31, 2015 Deferred Rent $ 19,389 $ 25,852 Advertising 76,639 76,639 Salaries and Benefits 58,937 64,007 Dividend Payable 85,558 319,854 Accrued Interest 44,249 44,249 Accrued Rent 50,078 49,614 Other 12,994 17,450 Total $ 347,844 $ 597,665

Stockholders' Deficiency (Table

Stockholders' Deficiency (Tables)	3 Months Ended
	Mar. 31, 2016
Stock Option [Member]
Schedule of Stock Granted	For The Three Months Ended March 31, 2016 2015 Risk free interest rate 1.63% to 2.12% n/a Dividend yield 0.00% n/a Expected volatility 199% to 200.0% n/a Expected life in years 5.5 to 10.0 n/a
Summary of Stock Activity	Weighted Average Average Remaining Aggregate Number of Exercise Life Intrinsic Options Price In Years Value Outstanding, January 1, 2016 5,341,284 $ 0.70 Granted 172,254 0.24 Exercised - - Forfeited (132,333 ) 0.49 Outstanding, March 31, 2016 5,381,205 $ 0.69 7.6 $ 332,554 Exercisable, March 31, 2016 4,169,539 $ 0.62 7.6 $ 240,254
Summary of Stock Outstanding and Exercisable	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 $ 0.09 - $2.20 $ 0.23 4,701,705 $ 0.25 8.0 3,740,039 $ 2.21 - $3.80 3.35 492,500 2.88 3.8 242,500 $ 3.81 - $6.99 5.17 187,000 5.17 5.4 187,000 $ 0.69 5,381,205 $ 0.62 7.6 4,169,539
Warrant [Member]
Schedule of Stock Granted	For The Three Months Ended March 31, 2016 2015 Risk free interest rate 1.58% 1.50% Dividend yield 0.00% 0.00% Expected volatility 200.0% 196.0% Contractual term in years 5.00 5.00
Summary of Stock Activity	Weighted Average Average Remaining Aggregate Number of Exercise Life Intrinsic Warrants Price In Years Value Outstanding, January 1, 2016 10,046,198 $ 0.41 Granted 75,000 0.25 Exercised - - Forfeited - - Outstanding, March 31, 2016 10,121,198 $ 0.40 3.1 $ 150,922 Exercisable, March 31, 2016 9,871,198 $ 0.34 3.1 $ 150,922
Summary of Stock Outstanding and Exercisable	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 $ 0.10 - $0.35 $ 0.25 9,571,198 $ 0.25 3.2 9,571,198 $ 0.36 - $3.00 2.90 520,000 2.90 0.5 270,000 $ 3.01 - $4.95 4.95 30,000 4.95 1.5 30,000 $ 0.10 - $4.95 $ 0.40 10,121,198 $ 0.33 3.1 9,871,198

Commitments and Contingent Li19

Commitments and Contingent Liabilities (Tables)	3 Months Ended
	Mar. 31, 2016
Commitments And Contingent Liabilities Tables
Summary of future minimum payments under operating leases	For years ending December 31, Amount 2016 $ 58,152 2017 91,783 2018 87,633 2019 85,482 Total future minimum lease payments $ 323,050

Going Concern and Management'20

Going Concern and Management's Liquidity Plans (Details Narrative) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2015
Going Concern And Managements Liquidity Plans Details Narrative
Working Capital Deficiency	$ (4,260,215)
Accumulated deficit	(31,498,616)		$ (31,159,401)
Net losses	(253,657)	$ (200,788)	(626,682)
Net Cash Used in Operating Activities	$ (100,637)	$ (208,308)	$ (548,281)

Summary of Significant Accoun21

Summary of Significant Accounting Policies (Details) - USD ($)	Mar. 31, 2016	Mar. 31, 2015
Summary Of Significant Accounting Policies Details
Options	$ 5,381,205	$ 3,944,557
Warrants	10,121,198	9,839,044
Series B Convertible Preferred Stock	5,892,720	5,507,202
Total potentially dilutive shares	$ 21,395,123	$ 19,290,803

Accrued Expenses and Other Cu22

Accrued Expenses and Other Current Liabilities (Details) - USD ($)	Mar. 31, 2016	Dec. 31, 2015
Accrued Expenses And Other Current Liabilities Details
Deferred rent	$ 19,389	$ 25,852
Advertising	76,639	76,639
Salaries and benefits	58,937	64,007
Dividends payable	85,558	319,854
Accrued interest	44,249	44,249
Accrued Rent	50,078	49,614
Other	12,994	17,450
Total	$ 347,844	$ 597,665

Notes Payable (Details Narrativ

Notes Payable (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Interest rate on Senior Note	7.75%
Fair value related to warrants	$ 15,500
Amortization of debt discount	3,444	$ 54,517
Lender [Member]
Borrowed loan	$ 1,000,000

Stockholders' Deficiency (Detai

Stockholders' Deficiency (Details) - Stock Option [Member]	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Risk free interest rate
Dividend yield	0.00%
Expected volatility
Minimum [Member]
Risk free interest rate	1.63%
Expected volatility	199.00%
Expected life in years	5 years 6 months
Maximum [Member]
Risk free interest rate	2.12%
Expected volatility	200.00%
Expected life in years	10 years

Stockholders' Deficiency (Det25

Stockholders' Deficiency (Details 1) - Stock Option [Member]	3 Months Ended
	Mar. 31, 2016USD ($)$ / sharesshares
Number of Options, outstanding
Outstanding, beginning of period (in shares) | shares	5,341,284
Granted | shares	172,254
Exercised | shares
Forfeited | shares	(132,333)
Outstanding, end of period (in shares) | shares	5,381,205
Exercisable, March 31, 2016 | shares	4,169,539
Weighted average exercise price
Outstanding, beginning of period (in dollars per share) | $ / shares	$ 0.70
Granted | $ / shares	$ 0.24
Exercised | $ / shares
Forfeited | $ / shares	$ 0.49
Outstanding, end of period (in dollars per share) | $ / shares	0.69
Exercisable, March 31, 2016 | $ / shares	$ 0.62
Weighted Average Remaining Life In Years
Weighted Average Remaining Life (in years) Outstanding	7 years 7 months 6 days
Weighted Average Remaining Life (in years) Exercisable	7 years 7 months 6 days
Aggregate Intrinsic Value
Aggregate Intrinsic Value Outstanding | $	$ 332,554
Aggregate Intrinsic Value Exercisable, March 31, 2016 | $	$ 240,254

Stockholders' Deficiency (Det26

Stockholders' Deficiency (Details 2) - Stock Option [Member] - $ / shares	3 Months Ended
	Mar. 31, 2016	Dec. 31, 2015
Weighted Average Exercise Price Outstanding	$ 0.69	$ 0.70
Number Outstanding	5,381,205	5,341,284
Weighted Average Exercise Price Exercisable	$ 0.62
Weighted Average Remaining Years of Contractual Life	7 years 7 months 6 days
Number Exercisable	4,169,539
$0.09 - $2.20
Weighted Average Exercise Price Outstanding	$ 0.23
Number Outstanding	4,701,705
Weighted Average Exercise Price Exercisable	$ 0.25
Weighted Average Remaining Years of Contractual Life	8 years
Number Exercisable	3,740,039
$2.21 - $3.80
Weighted Average Exercise Price Outstanding	$ 3.35
Number Outstanding	492,500
Weighted Average Exercise Price Exercisable	$ 2.88
Weighted Average Remaining Years of Contractual Life	3 years 9 months 18 days
Number Exercisable	242,500
$3.81 - $6.99
Weighted Average Exercise Price Outstanding	$ 5.17
Number Outstanding	187,000
Weighted Average Exercise Price Exercisable	$ 5.17
Weighted Average Remaining Years of Contractual Life	5 years 4 months 24 days
Number Exercisable	187,000

Stockholders' Deficiency (Det27

Stockholders' Deficiency (Details 3) - Warrant [Member]	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Risk free interest rate	1.58%	1.50%
Dividend yield	0.00%	0.00%
Expected volatility	200.00%	196.00%
Contractual term in years	5 years	5 years

Stockholders' Deficiency (Det28

Stockholders' Deficiency (Details 4) - Warrant [Member]	3 Months Ended
	Mar. 31, 2016USD ($)$ / sharesshares
Number of Warrants, outstanding
Outstanding, beginning of period (in shares) | shares	10,046,198
Granted | shares	75,000
Exercised | shares
Forfeited | shares
Outstanding, end of period (in shares) | shares	10,121,198
Exercisable, March 31, 2016 | shares	9,871,198
Weighted average exercise price
Outstanding, beginning of period (in dollars per share) | $ / shares	$ 0.41
Granted | $ / shares	$ 0.25
Exercised | $ / shares
Forfeited | $ / shares
Outstanding, end of period (in dollars per share) | $ / shares	$ 0.40
Exercisable, March 31, 2016 | $ / shares	$ 0.34
Weighted Average Remaining Life In Years
Weighted Average Remaining Life (in years) Outstanding	3 years 1 month 6 days
Weighted Average Remaining Life (in years) Exercisable	3 years 1 month 6 days
Aggregate Intrinsic Value
Aggregate Intrinsic Value Outstanding | $	$ 150,922
Aggregate Intrinsic Value Exercisable, March 31, 2016 | $	$ 150,922

Stockholders' Deficiency (Det29

Stockholders' Deficiency (Details 5) - Warrant [Member] - $ / shares	3 Months Ended
	Mar. 31, 2016	Dec. 31, 2015
Weighted Average Exercise Price Outstanding	$ 0.40	$ 0.41
Number Outstanding	10,121,198	10,046,198
Weighted Average Exercise Price Exercisable	$ 0.34
Weighted Average Remaining Years of Contractual Life	3 years 1 month 6 days
Number Exercisable	9,871,198
$0.10 - $0.35
Weighted Average Exercise Price Outstanding	$ 0.25
Number Outstanding	9,571,198
Weighted Average Exercise Price Exercisable	$ 0.25
Weighted Average Remaining Years of Contractual Life	3 years 2 months 12 days
Number Exercisable	9,571,198
$0.36 - $3.00
Weighted Average Exercise Price Outstanding	$ 2.9
Number Outstanding	520,000
Weighted Average Exercise Price Exercisable	$ 2.9
Weighted Average Remaining Years of Contractual Life	6 months
Number Exercisable	270,000
$3.01 - $4.95
Weighted Average Exercise Price Outstanding	$ 4.95
Number Outstanding	30,000
Weighted Average Exercise Price Exercisable	$ 4.95
Weighted Average Remaining Years of Contractual Life	1 year 6 months
Number Exercisable	30,000
$0.10 - $4.95
Weighted Average Exercise Price Outstanding	$ 0.4
Number Outstanding	10,121,198
Weighted Average Exercise Price Exercisable	$ 0.33
Weighted Average Remaining Years of Contractual Life	3 years 1 month 6 days
Number Exercisable	9,871,198

Stockholders' Deficiency (Det30

Stockholders' Deficiency (Details Narrative) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2015
Stock Option [Member]
Weighted Average Fair Value	$ 0.24	$ 0
Selling, General And Administrative Expenses	$ 75,138	$ 78,789
Stock-based compensation expense, unamortized	996,064
Stock-based compensation expense, amortized	$ 104,495
Weighted Average Remaining Period	2 years
Performance based option vesting	$ 891,569
Warrant [Member]
Weighted Average Fair Value	$ 0.24	$ 0.08
Selling, General And Administrative Expenses	$ 0	$ 216
Stock-based compensation expense, unamortized	$ 576,840
Series B Preferred Stock [Member]
Preferred Stock Contractual Dividends	85,558		319,853
Consultants [Member] | Stock Option [Member]
Common stock purchased	172,254
Aggregate grant date value	$ 41,379
Consultants [Member] | Stock Option [Member] | Minimum [Member]
Weighted Average Fair Value	$ 0.24
Consultants [Member] | Stock Option [Member] | Maximum [Member]
Weighted Average Fair Value	$ 0.25

Commitments and Contingent Li31

Commitments and Contingent Liabilities (Details)	Mar. 31, 2016USD ($)
Commitments And Contingent Liabilities Details
2,016	$ 58,152
2,017	91,783
2,018	87,633
2,019	85,482
Total future minimum lease payments	$ 323,050

Commitments and Contingent Li32

Commitments and Contingent Liabilities (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2015
Commitments And Contingent Liabilities Details Narrative
Deferred rent payable	$ 19,389		$ 25,852
Rent Expense	$ 20,274	$ 18,342

Concentrations (Details Narrati

Concentrations (Details Narrative)	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2015
Vendor 1 [Member]
Concentration Inventory Purchases Percentage	49.00%	74.00%
Concentration Accounts Payable Percentage	40.00%		43.00%
Vendor 2 [Member]
Concentration Inventory Purchases Percentage	16.00%	10.00%
Concentration Accounts Payable Percentage	12.00%		13.00%
Vendor 3 [Member]
Concentration Inventory Purchases Percentage	15.00%