8-K
OptimizeRx Corp (OPRX)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934Date of Report (Date of earliest event reported): August 4, 2021
OptimizeRx Corporation
(Exact name of registrant as specified in its charter)
| Nevada | 001-38543 | 26-1265381 |
|---|---|---|
| (State or other jurisdiction<br><br> of incorporation) | (Commission File Number) | (I.R.S. Employer <br><br>Identification No.) |
| 400 Water Street, Suite 200, Rochester, MI | 48307 | |
| --- | --- | |
| (Address of<br>principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: 248.651.6568
| (Former name or former address, if changed since<br> last report) |
|---|
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol | Name of each exchange on which registered |
|---|---|---|
| Common Stock | OPRX | Nasdaq Capital Market |
SECTION 2 – FinancialInformation
Item2.02 Results of Operations and Financial Condition.
On August 4, 2021, we issued a press release announcing the results of operations for the quarter ended June 30, 2021 and other matters. The press release is furnished with this Current Report on Form 8-K as Exhibit 99.1.
The information furnished under this Item 2.02 and Item 9.01 of this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any registration statement or other filing under the Securities Act of 1933, as amended, regardless of any general incorporation by reference language in such filing, except as shall be expressly set forth by specific reference in any such filing.
SECTION 9 – FinancialStatements and Exhibits
Item9.01 Financial Statements and Exhibits.
| Exhibit No. | Description |
|---|---|
| 99.1 | Press release, dated August 4, 2021 |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| OptimizeRx Corporation |
|---|
| /s/ Douglas Baker |
| Douglas Baker |
| Chief Financial Officer |
| Date August 5, 2021 |
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Exhibit99.1
OptimizeRx****Reports Second Quarter 2021 Financial Results,Revenue Up 55% as Leading Pharma Brands Aggressively Seek Improved ROI Through Technology Adoption
- Revenue Up 55% to $13.6 million, closing on 19 enterprise contracts
- Enterprise deals pipeline grows from 46 to 63
- Brands adopting OptimizeRx solutions increases to 140 from 80 in the past 6 months
- Successful implementation of evidence-based provider engagement programs, driven by real-world evidence (“RWE”), anchored by sales from 2 leading brands
- Cash flow positive from operations of $1.9 million in the first half of fiscal 2021
ROCHESTER,Mich. – August 4, 2021 – OptimizeRx Corp. (the “Company”) (Nasdaq: OPRX), a leading provider of digital health solutions for life science companies, physicians and patients, reported results for the three months ended June 30, 2021. Quarterly comparisons are to the same year-ago period.
FinancialHighlights
| ● | Revenue<br> in the second quarter of 2021 increased 55% to a record $13.6 million, from $8.8 million<br> as compared to the same year-ago period. |
|---|---|
| ● | Gross<br> profit in the second quarter of 2021 increased 56% to $8.0 million. |
| ● | Gross<br> profit margin in the second quarter of 2021 increased to 59% from 58.6%. |
| ● | GAAP<br> net income totaled $0.4 million or $0.02 per basic and diluted share in the second quarter<br> as compared to a net loss of $1.1 million or $0.07 per basic and fully diluted share in the<br> year ago period. |
| ● | Non-GAAP<br> net income in the second quarter totaled $1.8 million or $0.10 per basic and fully diluted<br> share respectively (see definition of this non-GAAP measure and reconciliation to GAAP, below).<br> Cash and cash equivalents totaled $83.9 million as of June 30, 2021 as compared to $82.3<br> million as of March 31, 2020. |
OperationalHighlights
| ● | Successful<br> implementation of evidence-based provider engagement programs, driven by real-world evidence<br> (“RWE”), anchored by sales from 2 leading brands |
|---|---|
| ● | Including agreement with a top 5 pharmaceutical manufacturer<br>in solving lapse in medical coverage barrier for patients |
| --- | --- |
| ● | Announced<br> several new health information technology (HIT) partnerships to further connect the digital<br> channels used by healthcare professionals (HCPs) within the care setting, expanding reach<br> to over 50% of oncologists. |
| --- | --- |
ManagementCommentary
“As a pioneering leader in digital health technology, we are delighted to report another record quarter of strong revenue growth, preceding what is expected to be a remarkable year for OptimizeRx. We could not be more pleased with the continuous adoption of our technology platform by leading brands while also closing on 19 enterprise deals in our sales pipeline for the quarter. Total enterprise deals since last quarter have also grown to 63 deals in pipeline from 46 with an average ACV of $1.1 million. We also continue to support pharma’s engagement across fast-growing specialty areas which has doubled to more than 50% from last year,” said OptimizeRx CEO, Will Febbo.
“We have successfully implemented evidence-based provider engagement programs using the innovative RWE platform enhancement we launched at the end of 2020. We are both humbled and proud of the connectivity that OptimizeRx’s digital health and communications platform has generated between the stakeholders that we serve, consisting of healthcare providers, patients and drug manufacturers,” continued Mr. Febbo. “With a focus on providing digital connectivity at point-of-care, our wide network reach and unique platform strategies are working seamlessly to raise awareness among providers about treatments and life sciences support. In doing so we are also helping patients to better afford and adhere to treatment regiments, by offering innovative, effective ways for life sciences to remain actively engaged throughout the patient care journey.”
“Additionally, our clients are benefitting and are seeing an average ROI of 8:1 with some as high as 20:1. The power of third-party measurement has been a key differentiator and is allowing us to accurately measure the value we deliver to our clients. As evidence of this, we have seen the number of brands adopting our technology jump from 80 to 140 in the last 6 months,” concluded Mr. Febbo.
Q2’2021Financial Summary
Totalrevenue reported for the three months ended June 30, 2021 was approximately $13.6 million, an increase of over 55% over the approximately $8.8 million from the same period in 2020. The increased revenue resulted from increases in sales in all our solutions.
Grossmargin was 59%, which increased slightly from the year-ago quarter. Gross margin is expected to improve on a quarter over quarter basis for the balance of the year as our RWE solution expands and we continue to launch new solutions that have higher margins.
Operatingexpenses increased to $7.7 million as compared to $6.2 million in the same year-ago quarter. The increase was due to the Company’s efforts to expand its solutions and build out its organization for future growth.
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NetIncome on a GAAP basis was approximately $0.4 million or $0.02 per basic and diluted share, as compared to a net loss of $1.1 million or $(0.07) per basic and fully diluted share in the second quarter of 2020.
Non-GAAPnet income was $1.8 million or $0.10 per basic and $0.10 per fully diluted share, compared to non-GAAP net income of $0.3 million or $0.02 per basic and fully diluted share in the same year-ago period (see definition of this non-GAAP measure and reconciliation to GAAP, below).
Cashand cash equivalents totaled $83.9 million as of June 30, 2021, as compared to $82.3 million as of March 31, 2020.
ConferenceCall
OptimizeRx management will host the presentation, followed by a question-and-answer period.
Date: Wednesday, August 4, 2021
Time: 4:30 p.m. Eastern time (1:30 p.m. Pacific time)
Web access: http://public.viavid.com/index.php?id=146009
Toll-free dial-in number: 1-800-430-8332
International dial-in number: 1-323-289-6576
Conference ID: 2901587
Please call the conference telephone number five minutes prior to the start time.
A replay of the call will remain available for 12 months via the Investors section of the OptimizeRx website at www.optimizerx.com/investors.
Definitionand Use of Non-GAAP Financial Measures
This earnings release includes a presentation of non-GAAP net income (loss) and non-GAAP earnings (loss) per share or non-GAAP EPS, both of which are non-GAAP financial measures.
The Company defines non-GAAP net income (loss) as GAAP net income (loss) with an adjustment to add back depreciation, amortization, stock-based compensation, acquisition expenses, income or loss related to the fair value of contingent consideration, and deferred income taxes. Non-GAAP EPS is defined as non-GAAP net income (loss) divided by the number of weighted average shares outstanding on a basic and diluted basis. The Company has provided non-GAAP financial measures to aid investors in better understanding its performance. Management believes that these non-GAAP financial measures provide additional insight into the operations and cashflow of the Company.
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Because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact a company’s non-cash operating expenses, management believes that providing non-GAAP financial measures that excludes non-cash expenses allows for meaningful comparisons between the Company’s core business operating results and those of other companies, as well as provides an important tool for financial and operational decision making and for evaluating the Company’s own core business operating results over different periods of time.
The Company’s non-GAAP net income (loss) and non-GAAP EPS measures may not provide information that is directly comparable to that provided by other companies in the Company’s industry, as other companies in the industry may calculate such non-GAAP financial results differently. The Company’s non-GAAP net income (loss) and non-GAAP EPS are not measurements of financial performance under GAAP and should not be considered as an alternative to operating income or as an indication of operating performance or any other measure of performance derived in accordance with GAAP. The Company does not consider these non-GAAP measures to be substitutes for or superior to the information provided by its GAAP financial results.
The table, “Reconciliation of non-GAAP to GAAP Financial Measures,” included below, provides a reconciliation of non-GAAP net income (loss) and non-GAAP EPS for the three months ended March 31, 2021 and 2020.
AboutOptimizeRx
OptimizeRx is a digital health company that provides communications solutions for life science companies, physicians and patients. Connecting over half of healthcare providers in the U.S. and millions of patients through a proprietary network, the OptimizeRx digital health platform helps patients afford and stay on medications. The platform unlocks new patient and physician touchpoints for life science companies along the patient journey, from point-of-care, to retail pharmacy, through mobile patient engagement.
For more information, follow the Company on Twitter, LinkedIn or visit www.optimizerx.com.
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ImportantCautions Regarding Forward-Looking Statements
This press release contains forward-looking statements within the definition of Section 27A of the Securities Act of 1933, as amended, and such as in section 21E of the Securities and Exchange Act of 1934, as amended. These forward-looking statements should not be used to make an investment decision. The words ‘estimate,’ ‘possible’ and ‘seeking’ and similar expressions identify forward-looking statements, which speak only as to the date the statement was made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether because of new information, future events, or otherwise. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted, or quantified. Future events and actual results could differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. The risks and uncertainties to which forward-looking statements are subject include, but are not limited to, the effect of government regulation, competition, and other material risks.
OptimizeRxContact
Doug Baker, CFO
Tel (248) 651-6568 x807
MediaRelations Contact
Maira Alejandra, Media Relations Manager
Tel (754) 245-7070
InvestorRelations Contact
Ashley Robinson
LifeSci Advisors, LLC
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OPTIMIZERXCORPORATION
CONDENSEDCONSOLIDATED BALANCE SHEETS
(UNAUDITED)
| **** | December 31, 2020 | **** | |||
|---|---|---|---|---|---|
| ASSETS | |||||
| Current Assets | |||||
| Cash and cash equivalents | 83,923,455 | $ | 10,516,776 | ||
| Accounts receivable, net | 17,933,926 | 17,885,705 | |||
| Prepaid expenses | 3,124,479 | 4,456,611 | |||
| Total Current Assets | 104,981,860 | 32,859,092 | |||
| Property and equipment, net | 137,813 | 148,854 | |||
| Other Assets | |||||
| Goodwill | 14,740,031 | 14,740,031 | |||
| Technology assets, net | 4,896,016 | 5,251,822 | |||
| Patent rights, net | 2,258,542 | 2,349,570 | |||
| Other intangible assets, net | 4,203,777 | 4,519,552 | |||
| Right of use assets, net | 392,482 | 445,974 | |||
| Other assets and deposits | 12,859 | 12,859 | |||
| Total Other Assets | 26,503,707 | 27,319,808 | |||
| TOTAL ASSETS | 131,623,380 | $ | 60,327,754 | ||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||
| Current Liabilities | |||||
| Accounts payable – trade | 805,461 | $ | 618,250 | ||
| Accrued expenses | 2,088,651 | 2,420,361 | |||
| Revenue share payable | 3,341,312 | 4,969,868 | |||
| Current portion of lease obligations | 110,271 | 123,220 | |||
| Current portion of contingent purchase price payable | - | 1,610,813 | |||
| Deferred revenue | 319,609 | 285,795 | |||
| Total Current Liabilities | 6,665,304 | 10,028,307 | |||
| Non-current Liabilities | |||||
| Lease obligations, net of current portion | 282,934 | 325,533 | |||
| Total Non-current Liabilities | 282,934 | 325,533 | |||
| Total Liabilities | 6,948,238 | 10,353,840 | |||
| Commitments and contingencies (See Note 8) | - | - | |||
| Stockholders’ Equity | |||||
| Preferred stock, 0.001 par value, 10,000,000 shares authorized, no issued and outstanding at June 30, 2021 or December 31, 2020 | - | - | |||
| Common stock, 0.001 par value, 500,000,000 shares authorized, 17,495,429 and 15,223,340 shares issued and outstanding at June 30, 2021 and December 31, 2020, respectively | 17,495 | 15,223 | |||
| Additional paid-in-capital | 160,574,661 | 85,590,428 | |||
| Accumulated deficit | (35,917,014 | ) | (35,631,737 | ) | |
| Total Stockholders’ Equity | 124,675,142 | 49,973,914 | |||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | 131,623,380 | $ | 60,327,754 |
All values are in US Dollars.
The accompanying notes are an integral part of these condensed consolidated financial statements.
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OPTIMIZERxCORPORATION
CONDENSEDCONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
| **** | For the Three Months Ended | **** | For the Six Months Ended | **** | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| **** | June 30, | **** | June 30, | **** | |||||||
| **** | 2021 | 2020 | **** | 2021 | **** | 2020 | **** | ||||
| NET REVENUE | $ | 13,625,639 | $ | 8,783,230 | $ | 24,854,850 | $ | 16,367,832 | |||
| COST OF REVENUES | 5,580,964 | 3,639,016 | 10,685,567 | 6,880,779 | |||||||
| GROSS MARGIN | 8,044,675 | 5,144,214 | 14,169,283 | 9,487,053 | |||||||
| OPERATING EXPENSES | 7,704,536 | 6,200,027 | 14,467,452 | 12,802,118 | |||||||
| INCOME (LOSS) FROM OPERATIONS | 340,139 | (1,055,813 | ) | (298,169 | ) | (3,315,065 | ) | ||||
| OTHER INCOME (EXPENSE) | |||||||||||
| Interest income | 11,961 | 8,345 | 12,892 | 63,666 | |||||||
| Change in Fair Value of Contingent Consideration | - | (30,000 | ) | - | (30,000 | ) | |||||
| TOTAL OTHER INCOME (EXPENSE) | 11,961 | (21,655 | ) | 12,892 | 33,666 | ||||||
| INCOME(LOSS) BEFORE PROVISION FOR INCOME TAXES | 352,100 | (1,077,468 | ) | (285,277 | ) | (3,281,399 | ) | ||||
| PROVISION FOR INCOME TAXES | - | - | - | - | |||||||
| NET INCOME (LOSS) | $ | 352,100 | $ | (1,077,468 | ) | $ | (285,277 | ) | $ | (3,281,399 | ) |
| WEIGHTED AVERGE SHARES OUTSTANDING | |||||||||||
| BASIC | 17,347,096 | 14,667,216 | 16,720,114 | 14,638,359 | |||||||
| DILUTED | 18,104,807 | 14,667,216 | 16,720,114 | 14,638,359 | |||||||
| EARNINGS (LOSS) PER SHARE | |||||||||||
| BASIC | $ | 0.02 | $ | (0.07 | ) | $ | (0.02 | ) | $ | (0.22 | ) |
| DILUTED | $ | 0.02 | $ | (0.07 | ) | $ | (0.02 | ) | $ | (0.22 | ) |
The accompanying notes are an integral part of these condensed consolidated financial statements.
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OPTIMIZERxCORPORATION
CONDENSEDCONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
| **** | For the Six Months Ended June 30, | **** | ||||
|---|---|---|---|---|---|---|
| **** | 2021 | **** | 2020 | **** | ||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||
| Net Loss | $ | (285,277 | ) | $ | (3,281,399 | ) |
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||
| Depreciation, amortization, and non-cash lease expense | 1,054,138 | 1,040,463 | ||||
| Stock-based compensation | 1,354,106 | 1,435,156 | ||||
| Stock issued for board services | 250,085 | 200,027 | ||||
| Provision for loss on accounts receivable | 40,000 | 40,000 | ||||
| Change in fair value of contingent consideration | - | 30,000 | ||||
| Changes in: | ||||||
| Accounts receivable | (88,221 | ) | (3.427,166 | ) | ||
| Prepaid expenses and other assets | 1,332,132 | (1,785,422 | ) | |||
| Accounts payable | 187,211 | 3,747 | ||||
| Revenue share payable | (1,628,556 | ) | 1,878,051 | |||
| Accrued expenses and other liabilities | (393,778 | ) | 186,682 | |||
| Deferred revenue | 33,814 | 68,678 | ||||
| NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | 1,855,654 | (3,611,183 | ) | |||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||
| Purchase of equipment | (43,654 | ) | (24,998 | ) | ||
| Purchase of intangible assets | (176,822 | ) | - | |||
| NET CASH USED IN INVESTING ACTIVITIES | (220,476 | ) | (24,998 | ) | ||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||
| Proceeds from public offering of common stock, net of commission costs | 70,671,536 | - | ||||
| Proceeds from the exercise of options | 2,710,778 | 286,983 | ||||
| Payment of contingent consideration | (1,610,813 | ) | (1,389,188 | ) | ||
| NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | 71,771,501 | (1,102,205 | ) | |||
| NET INCREASE IN CASH AND CASH EQUIVALENTS | 73,406,679 | (4,738,386 | ) | |||
| CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 10,516,776 | 18,852,680 | ||||
| CASH AND CASH EQUIVALENTS - END OF PERIOD | $ | 83,923,455 | $ | 14,114,294 | ||
| SUPPLEMENTAL CASH FLOW INFORMATION: | ||||||
| Cash paid for interest | $ | - | $ | - | ||
| Cash paid for income taxes | $ | - | $ | - | ||
| Lease liabilities arising from right of use assets | $ | - | $ | - |
The accompanying notes are an integral part of these condensed consolidated financial statements.
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OPTIMIZERxCORPORATION
Reconciliationof non-GAAP to GAAP Financial Measures
(Unaudited)
| **** | For the Three Months Ended | **** | For the Six Months Ended | **** | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| **** | June 30, | **** | June 30, | **** | |||||||
| **** | 2021 | 2020 | **** | 2021 | **** | 2020 | **** | ||||
| Net Income (loss) | 352,100 | (1,077,468 | ) | (285,277 | ) | (3,281,399 | ) | ||||
| Depreciation and amortization | 527,696 | 520,794 | 1,054,138 | 1,040,463 | |||||||
| Stock-based compensation | 897,038 | 780,670 | 1,604,191 | 1,635,182 | |||||||
| Income or loss related to the fair value of contingent consideration | - | 30,000 | - | - | |||||||
| Non-GAAP net income (loss) | 1,776,834 | 253,996 | 2,373,052 | (605,754 | ) | ||||||
| Non-GAAP net income (loss) per share | |||||||||||
| Basic | $ | 0.10 | $ | 0.02 | $ | 0.14 | $ | (0.04 | ) | ||
| Diluted | $ | 0.10 | $ | 0.02 | $ | 0.14 | $ | (0.04 | ) | ||
| Weighted average shares outstanding: | |||||||||||
| Basic | 17,347,096 | 14,667,216 | 16,720,114 | 14,638,359 | |||||||
| Diluted | 18,104,807 | 15,573,257 | 17,467,159 | 14,638,359 |
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