Doug Baker - Chief Financial Officer Dave Harrell - Chairman and Chief Executive Office Terry Hamilton - Senior Vice President of Sales Ed Berger - Vice President of Sales, East David Lester - Vice President, Channel Management

Brian Murphy - Merriman Kevin Tracey - Oberon

Good day everyone and welcome to the OptimizeRx Corporation 2014 Annual Earnings Conference Call. Following the initial discussion, there will be time for question from the participants in the call. Just as a reminder today’s conference is being recorded. A transcript will be available for 90 days or those interested parties who want a copy, please contact Doug Baker, in our Rochester, Michigan Headquarters. Now for opening remarks and introductions, I would now like to turn the conference over to Doug Baker, Chief Financial Officer for OptimizeRx.

Thanks, Victoria. I would like to start off by welcoming everybody to the conference call. And as you know, I'm going to start off by reading the Safe Harbor statement. This conference contains forward-looking statements within the definition of Section 27A of the Securities Act of 1933 as amended and such Section 21E of the Securities Act of 1934 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 for the date the statement was made. The company undertakes no obligation to publicly update or revise any forward-looking statements whether because of new company information, future events or otherwise. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Further events and actual results could differ materially from those set forth and 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 effective government regulation, competition and other material risk. At this point, I am now going to turn the call over to Dave Harrell, our CEO for some opening remarks.

Thank you, Doug, and thanks everybody. So today I wanted to just talk about we’re going highlight today four key buckets, the first key bucket is how we’re expanding pharmaceutical brands and budgets and how we not only did in the 2014 but how we’re going to move forward very aggressively in 2015. The second bucket we’re going to talk about expanding physician utilization in our current EHR Network. The third bucket we’re going to speak to is how we’re going to have expanded our promotional network in other EHRs and platforms. And then our last bucket focuses on our fourth objective which is to expand infrastructure and resources to fully support and exploit each of our three opportunities that I just listed. So with that I wanted to make some opening comments as it relates to pumping out our success in each of these key areas and then bringing it to each of the leaders in our departments, so that they can speak to how we’re further going to ramp it up. In regards to sustaining the pharmaceutical brands and budget as you may have realized that looking at our 10-K, we were successful expanding our sales overall by 39% over 2013. We also increased promotional transactions of approximately 26% over 2013 and Doug will speak a little bit more about our financial performance that did improve. Secondly, we continued to acquire new pharmaceutical manufacturers and brands that were promoted through our platforms and distributed through our EHR Systems and have worked with approximately 80 different brands which the sizable increase from last year. We also hired a former global marketing director from one of the leading pharma company AstraZeneca to lead and assist us on our East Coast sales in our overall marketing efforts so you’re going to be introduced to. We’ve also spent an extensive amount of time in resources to conduct five independent analyses that proved out an outstanding return on investment for our pharmaceutical clients that we’re looking to fully leverage as part of our strategy. And lastly, we launched g VoucherDVM within the animal healthcare market and have successfully met with multiple pharmaceutical manufacturers and platforms and have actually concluded our first agreement to rollout a beta test with one of the leading animal health systems in the country, National Veterinary Associates. Terry Hamilton will speak on each of these and most importantly how we’re going to continue to ramp that up in 2015. The second bucket of what the expanding physician utilization in our current EHR Network has been a key focus and in fourth quarter we were able to show results in fact we've moved David Lester to focus his experience and strong knowledge to strictly focus on doing this along with expanding our EHR Network along with his team and we’ve already seen some great results in expanding our Allscripts PRO network and some other things that Dave is going to highlight. Again we feel this is a critical growth factor for us and we’re awaiting and further explaining that within our existing EHR Networks. The third bucket, I alluded to regarding expanding our promotional network in other EHRs and platforms, certainly has been accomplished in 2014 with the addition of Quest Diagnostics Care360 and EHealthline networks, but most importantly we’re preparing for some big expansions and the good news is Practice Fusion integration is close to be completed and will be on time for its launch likely early next week. We’re also seeking in the midst of active new expansion with new EHRs and new platforms that will significantly drive our growth in 2015. Again David Lester will speak on some of these key strategies during this call. And lastly again, making sure that we have the right infrastructure and the right resources to fully support and exploit each of these above previous critical. And we’ve taken some major steps in 2014 to position us, that includes first and foremost hiring Doug Baker who brings and has proven to be a very highly skilled executive within our team, we’ve expanded our Board of Directors with some seasoned executives, we cleaned up our cash structure which net resulted in additional approximately $3 million to use and reduced our overall cap dilution of about 7 million. And then we have dramatically invested in our Sample 2.0 technology, and the key to this is along with our Oracle integration is that we can absolutely scale. So again we look forward to not only speaking to any questions you have of 2014 and our advance with these key areas but more importantly how we’re going to ramp those up. So with that prior to presenting Terry and Dave Lester I wanted Doug Baker to spend a few minutes highlighting some of our 2014 and fourth quarter results. Thank you.

Thanks Dave. So as Dave mentioned our revenues last year were 6.5 million, we finished the year strong with revenues of over $1.9 million in the fourth quarter alone, that was an increase of 17% over the fourth quarter of 2013. For 2014 in total we generated operating income of approximately 400,000 excluding non-cash expenses. In the fourth quarter of 2014 we had actual net income of approximately 230,000, this really demonstrates the operating leverage of our business and how it generates profits and cash flow as sales ramp up. On the expense side we continue to watch expenses very closely, we have well over 1 million in expenses in 2014 that will not reoccur in 2015. There are however two areas where we are willing to increase spending when justified. The first really is opportunities we get in front of potential customers and allows us to increase revenues; this includes things like conferences, marketing, additional sales personnel and other similar expenses. The second area is on product development integration. These items are related to technology allow us to expand our regional outlets to offer additional products and applications. First quarter of 2015 is just about over and it looks like it’s falling in line with our expectations. There's some seasonality to our business as pharmaceutical companies often get off to a slow start but we expect to easily exceed the revenue levels for the first quarter of 2014. The year is off to a good start and -- our goal to exceed expectations. With that that I’m going to turn it over to Terry Hamilton, our Senior Vice President of Sales.

Thanks Doug. I really appreciate the opportunity to speak with all of you today, and let me begin by introducing myself. As Doug said my name is Terry Hamilton and I’m the Senior VP of Sales for OptimizeRx. I’ve been at OptimizeRx since January 2000 and I lead the team that calls on and manages the pharma manufacturers and brands. A little bit about my background, my background’s in the pharma biotech area spending around 20 plus years with several companies including GSK, EMS and [NetImmune], involving several leadership positions in sales, marketing and managed markets. I also have a very key member of my team Ed Berger our VP of Sales in the East on the line and allow him now to personally introduce himself.

Thank you so much Terry and welcome everyone, as Terry said my name is Ed Berger and I am the Vice President of sales for East Coast Accounts, my background is I spent over 25 years working within pharma marketing brands prior to joining OptimizeRx. I joined OptimizeRx because I believe that the ERX and EHR channel is going to become a really critical channel for pharma marketing success in the future, and I think having come from pharma has helped me better position our services here at OptimizeRx to clients as we continue what I think is great growth, Terry.

Thanks Ed. Our sales team's goal is to be laser focused in 2015 and I thought I would share our team’s brand vision, our market strategy and the strategic drivers with all of you on the call. First of all our brand vision is to become the number one solution provider in electronic healthcare pathway to improve stakeholder results. Our market strategy is to be the first owned eCoupon space to expand support solutions and we’re going to do that by four strategic drivers. First we want to protect and grow our existing brands business; second we want to secure new brand business from our existing accounts; third we want to establish new pharma business accounts; and lastly we want to grow additional revenue in business from our additional capabilities such as drug filing integration, training and messaging. I’m going to talk in a little more detail in regards to these four strategic drivers. The first strategic driver again was to protect and grow our existing brands business. Currently we have secured purchase orders from our existing clients that would in itself improve sales over the last year; those strategic clients include Lilly, DSI, Alcon, Astellas, and Pfizer. The second strategic driver is to secure new brand business from existing accounts. The sales process can be very tedious and long, so we really want to leverage the accounts where we have MSAs and legal approval to expedite getting the brands integrated. Some of these accounts where we see good leverage are Alcon, Pfizer, Shire, Novartis, NAV. We really see the strategy as a great way to add additional brands in the short period of time. The third strategic driver again is to establish new pharma business accounts. As I mentioned the sales cycle can be longer with these accounts, but there are some top accounts where we can add some very profitable brands, so these accounts include Takeda, GSK, Johnson & Johnson, Otsuka and Sanofi. Lastly, we want to increase revenue from our additional capabilities. I mentioned in drug filing integration, training and messaging. Just to give you a little more insight in regards to these capabilities, drug filing integration is a capability that manages the process for a launch brand a brand with a new indication or dose to be loaded in ePrescribe platforms. There is a misperception out in the market that launch brand is launched that it will automatically show up in the ePrescribe platforms, it's not the case. We've assisted multiple brands through this process and alone we have managed four brands through this process, but potentially we'll be managing three more brands in 2015. When we assist a brand through this process, we also demand that they use our eCoupon when training is normally a critical part of the process. So, the drug filing integration is greatly levered to us to sell additional opportunities within the brand. Let me script in greater detail on training which is another outstanding growth opportunity. With our partnership of Grey we have developed or are in the process of developing several training modules for pharma including EHR 101 if kind of gives the pharmaceutical representatives some background in their ePrescribe -- the ePrescribe platforms. Videos on the ePrescribe, eCoupon process, drug filing integration and the process that the representatives need to take for us to manage it and maybe also develop some tools for the pharmaceutical reps and the eCoupon processing, how to sell on to the office in the pharmacy. Lastly, several of our ePrescribe partners offer messaging opportunities through their platform which might keen as opportunity itself. With these four well defined strategic drivers, the sales team is confident we can maximize our revenue for 2015. Lastly, I wanted to view our critical sales success factors to generate revenue in 2015. One, we need to maximize our campaign performance in our current EHR channels. Utilization and metrics vary amongst different programs and channels and the account management team need to monitor each program to ensure we’re meeting the brand's goals. Second, we need to integrate promotions into new EHR channels including the LDM/PDR network. Three, we need to expand our sales organization; we organized our sales structure in 2015 and are looking at a couple of key candidates to add to the team as soon as possible. Four, we need to ramp our marketing; we need to change the value perception in eCoupon from increasing redemption to increasing prescription with. In the past, pharma had no other performance indicators to evaluate program besides redemptions. Now through the third-party vendor they can measure prescription work from providers that have access to the eCoupon to compare that to a controlled group that does not have access to the eCoupon. Multiple third-party vendors have shown a 3:1 to a 12:1 ROI based on prescription lift. Furthermore, vendors have prepared the eCoupon to other marketing initiatives in the EHR and the eCoupon was by far the most effective tactic in this channel. As I mentioned, training is very important to develop the rep sales pieces, to have marketing reps and willing to be the leader in conferences that apply to the EHR in marketing and EHR marketing initiatives. We recently sponsored the EHR conference last week which Ed Berger took lead for us, Ed can you share some of the comments from the conference.

Sure Terry would be happy to. As Terry mentioned last week optimize our [ex-sponsor] over the two days seminar entitled eRx EHR promotional opportunities, how to leverage and we called it the new frontier. It's important to note that had this conference, we had 23 different pharmaceutical company sending representatives to this event, that’s no small accomplishment because having come from pharma I would tell you to spend two days at an event, it has to be something that’s meaningful to them. And so we were pleased with the attendance and we had just about as many pharmaceutical communication agencies and consultants in attendance as well. The two-day event focused exclusively on how the eRX and EHR platform is what we believe fundamentally changing, how patients are being treated by HCPs. And I will say that, that pharma marketers are seeing the EHR as a new channel to communicate with their audiences and at this meeting customers were coming up to ask, they were asking for our direction and we were totally inundated at the booth by customers asking us like how do we get started, where do go from -- in terms of the next step. And lastly I will say you know I mean we established so many new contacts and are following up on requests that we believe will generate new business. And I will close by just saying I mean we were clearly seen as the leader in ePrescribing and in the EHR platforms and it’s events like this that help really cement our leadership position where we develop relationships and move marketers into what we believe is this really important new frontier. And so with that Terry I’ll turn it back to you.

Thanks Ed, great comments. I would only add that not only will the conference significant lever for pharmaceutical manufacturers and brands it was also a great lever for our potential EHR clients, there were several EHR, ePrescribe participants in the audience and as Ed said we were seen as the leader in the conference. I’ll touch on the last two critical success factors that impact sales and really meet the managed pharma by alleviating their Medicare concerns through our ability to target their offers to patients under the age of 65. Also we’re making every effort to shorten the pharma sales cycle. As I mentioned several times pharma is very slow moving through their industries, so through our extensive pharma knowledge we need to expedite brands in the EHR channel. Lastly we will really need to leverage our partnership with Grey, DrFirst, Allscripts and Practice Fusion. I will conclude -- I’m very, very confident in our team, our sales plan, our pipeline in our EHR growth. With that I’m going to turn it over to David Lester who’s going to expand upon the EHR strategy and growth.

Thank you Terry and thank you Ed, greatly appreciate that. As Terry and Ed and Dave have been discussing, as have highlighted, one of the things that we wanted to focus on and changing my responsibility was to continue building out and working with the current channel partners to expand promotional utilization of the current network, make sure that we’re getting the most out the current partners that we have, that we leverage every opportunity that we have within those channels and the next piece obviously of my focus is to expand within new platforms, looking at who those new channel partners are to expand the extent of our network. To address the first one under promotion utilization under the current network, one of the first things that I did as I sat down with our team here within OptimizeRx and we did a review of each one of our current channel partners, major topics of review were identifying again their total size of the prescribing base, making sure that we have covered and we understand the percentage of that prescribing base that in fact have access to our eCoupon solution. We looked at average utilization by doctor, we looked at physician specialty makeup and started pouring some of these key indicators together in a review and started scheduling meetings with each one of our key partners. Further we centered around what are some of the lost opportunities, what are the finance implications by -- as an example not maximizing the reach across all prescribing physicians and started to also build additional suggestions where we could leverage the opportunity with each one of those partners. We’ve scheduled the meetings, began meeting with each one of the key partners and a couple of examples of the collaboration that we got, we recently met with DrFirst and they have in fact committed to implementing the sample of the eCoupon solution in an additional 12,000 physicians by integrating our solution into their patient advisory platform in Q2. Another great example is the collaboration that we’ve gotten from the early meetings that we’ve been holding. We met with Allscripts in which we focused on their PRO platform, they were rolling out an update for all their users needing to opt out as opposed to opt in, which means that each one of the prescribing physicians now automatically have access to the e-couponing and if they don’t they have to opt out of it, what we’ve seen as a result is another 3,000 prescribing doctors now having access to the eCoupon solution. In addition in early second quarter Allscripts has scheduled to rollout an updated version of PRO that focuses on updating a compliance and regulatory requirement. In fact what they expect is that many of the lower version users will be updating their PRO package that will now have access to coupons as well. But we anticipate that might be another 5,000 to 6,000 prescribing physicians within that network as well. Again we’re continuing to focus on the process of doing meetings with the rest of our channel partners. We truly anticipate that we’ll have the same kind of experience and results as we’ve had with these first two with DrFirst in Allscripts by example. And looking at expanding to new platforms, we’re also working to expand the network reach. There are three primary areas that we’re focusing in on this. Number one, we’re completing the integration of the Practice Fusion as Terry referenced to, network that we’ll be lunching this week, so we’re really excited about that Practice Fusion brings a great opportunity 35,000 to 40,000 ePrescribing clinicians within their network, so we’re really excited about bringing that out of [indiscernible] what that activity will do. We continue to leverage our leadership position to the closest EHRs and doing some outreach we’ve got a number of early conversations going on with those EHRs and we’ll continue to leverage our partnership with the pharmaceutical manufacturers to introduce our solutions to health systems and other platforms to help drive the demand and reach until we continue to expand our network reach. There'll be more to comment in future quarters but with that I will turn the phone call back over to Mr. David Harrell.

So in summary, OptimizeRx continues to be a great growth opportunity and helping all key stakeholders pharmaceutical manufacturers, doctors and the patients we all try of serve. In other words, all stakeholders win with our technology and our story is getting better and better and more compelling to each one. OptimizeRx is the first move and the leaders in this extensive growing field. The number of brands have grown the number of distributions have grown, the number of doctors have grown and the operating model has significant leverage. Again, we feel like our model is poised for great growth in the near and longer term future and we will invest in both sales and customer facing opportunities and product development and integration so that we can fully capitalize. So with that, I would like to open it up for questions and ask that we keep questions to one and maybe a follow-up if necessary. Thank you.

[Operator Instructions]. You first question comes from the line of Brian Murphy with Merriman.

I think this is for Doug, Doug just a couple of housekeeping questions. Can you give us the depreciation and amortization and the stock comp for the fourth quarter?

Brian, I don’t have those right on my figure tips, but I can get back to you with all.

And I had another question and maybe this is for David Lester just about some of the improvements you’re trying to make just in terms of utilization. So I guess just from language in your filings pre-Practice Fusion I guess you’re reaching about 300,000 physicians and it’s still early days it looks like in terms of adoption. So you have only about 20,000 physicians that are actively engaged right now. So that sort of an engagement percentage of less than 7%. And realizing that that’s going to take some time to kind of ramp up, I am wondering how should we think about where that engagement number can go over time?

Well, I can speak to that. First of all our engagement is higher than that but again there is a significant portion of doctors that haven’t engaged that next number one because A, they may not have brands that they’re highly utilizing, that we're promoting coupons for. So again as things start to ramp up on the brand side that’s going to certainly ramp number of users. And the second opportunity is again making sure that all of our entire network has access to the eCoupon and that’s opportunity. I think clearly I would say that between those two we should be reaching closer to 70% to 75% over the next 12 months and down. I think that’s tremendous growth opportunities in our network.

[Operator Instructions]. Your next question comes from the line of Kevin Tracey with Oberon.

First there was a note in your 10-K that shows that your two biggest customer biggest customers in both 2013, 2014 revenue when down. In 2014 from 2013, I think the biggest customer from 1.8 million to 1.3 million and the second biggest customer from little over 1 million to just under 800,000. Can you explain I guess why that was the case as I would have expected you to be growing with all of your customers as you continue to add brands?

Yes, so the key thing with Lilly though they are fully ramping up with us, is one of their largest brand Cymbalta lost patent. So that had a significant impact, they do have all of their promoter brands in our system and have secured purchase orders for significant growth as we ramp up. Once again in the Cymbalta that represented a very, very sizeable amount of Lilly's programs. Yes, I can’t -- Alcon was the other one -- Alcon was after the first quarter of -- and you recall they wanted to join ROI study on that just to validate the influence on left. So since then I think the quarters have been probably stronger than ever.

And then it's my understanding that Practice Fusion caters primarily to primary care physicians who are presumably writing high volume brands as their prescriptions; is because of that -- would you expect greater share of the 35,000 to 40,000 doctors be actively using your coupons or can you talk about that a little bit?

Yes that’s good insight and you're right. Some of the networks have higher specialty versus primary care, so again Practice Fusion has had great success in offering their -- primarily their free EHR and then building from there to primary care physicians. I think the mix is more like 50%. So I think our utilization will be higher and again we’re looking forward to once its launched really look at the metrics and work with again like we’re doing with our existing platforms. Their technology, management and sales force to fully ramp up that opportunity.

[Operator Instructions]. And there are currently no further questions in queue. I’ll turn it back over to the presenters for any closing remarks.

So again thanks everybody for taking the time. I am very pleased that you got to meet other key members of our management and sales and marketing team. We’re very, very excited about the future; we’re very excited about our ongoing discussions with both our existing and future network partners. And we feel very, very excited about the momentum that we’ve created at the pharmaceutical conference and feel the market has finally caught up to the opportunities that we’ve been evangelizing and we look forward to further scaling up in 2015 and having even greater results. So thank you and anybody that has any direct questions, feel free to reach out to Doug Baker after this.

Again thank you for your participation. This concludes today's conference call.