What changed in this filing

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Item 1A. Risk Factors

2023-03-10 compared with 2015-09-16 · 460 added, 267 removed, 1 unchanged (100% of the section changed)

Relating to Business and Financial Condition

we have historically experienced losses, if we are unable to achieve profitability, our financial condition and company could

the inception of our business we have historically incurred losses.

While we have increased revenues significantly, we have not

yet been able to achieve profitability due to significant investments in our growth.

Our ability to achieve consistent profitability

depends on our ability to generate sales through our technology platform and advertising model, while maintaining reasonable expense

If we do not achieve sustainable profitability, it may impact our ability to continue our operations.

business and growth may suffer if we are unable to attract and retain key employees.

success depends on the expertise of our executive officers and certain other key technical personnel.

It may be difficult to find

sufficiently qualified individuals to replace management or other key technical personnel in the event of death, disability or

resignation, thus frustrating our ability to implement our business plan, which could negatively affect our operating results.

our ability to expand operations to accommodate our anticipated growth will also depend on our ability to attract and retain qualified

media, management, finance, marketing, sales and technical personnel.

However, competition for these types of employees is intense

due to the limited number of qualified professionals.

Our ability to meet our business development objectives will depend in part

on our ability to recruit, train and retain top quality people with advanced skills who understand our technology and business.

We believe that we will be able to attract competent employees, but no assurance can be given that we will be successful in this

If we are unable to engage and retain the necessary personnel, our business may be materially and adversely affected.

failure to obtain retain or attract additional customers could prevent us from successfully executing our business plan.

currently work with many leading pharmaceutical companies, including Pfizer, Eli Lilly, Auxilium, Actavis, AstraZeneca, Alcon,

Daichi Sankyo, Shire, Activis, and others.

Our failure to retain existing customers or expand with new customers could negatively

impact our business.

are dependent on a concentrated group of customers

revenues are concentrated in approximately 25 customers, primarily large pharmaceutical manufacturers and large advertising agencies.

Approximately 64% of our revenue came from our largest five customers.

Loss of one or more of these customers could have a significant

negative impact on our operating results.

may be unable to support our technology to further scale our operations successfully.

plan is to grow rapidly through further integration of our technology in electronic platforms.

Our growth will place significant

demands on our management and technology development, as well as our financial, administrative and other resources.

guarantee that any of the systems, procedures and controls we put in place will be adequate to support the commercialization of

our operations.

Our operating results will depend substantially on the ability of our officers and key employees to manage changing

business conditions and to implement and improve our financial, administrative and other resources.

If we are unable to respond

to and manage changing business conditions, or the scale of our products, services and operations, then the quality of our services,

our ability to retain key personnel and our business could be harmed.

we are unable to maintain our contracts with electronic prescription platforms, our business will suffer.

are reliant upon our contracts with leading electronic prescribing platforms, including Allscripts, Dr.

First, Quest Diagnostics,

We will need to maintain these relationships as well as diversify them.

The inability to do so could adversely impact

our business.

Our agreements with electronic

prescription platforms are subject to audit, which could subject us to additional costs that might affect our results of operations.

agreements with our electronic prescription platform partners provide for revenue sharing payments to the platform partners based

on the revenue we generate through the platform.

These payments are subject to audit by our partners, at their cost, and if there

is a dispute as to the calculation, we may be liable for additional payments.

If an underpayment is determined to be in excess

of a certain amount, for example 10%, some agreements would require us to pay for the cost of the audit, as well.

and implementing new and updated applications, features and services for our portals may be more difficult than expected, may

take longer and cost more than expected and may not result in sufficient increases in revenue to justify the costs.

have completed the development and migration of SampleMD 2.0’s on-demand, rule based content delivery platform.

can now manage up to 1 million rules and return the appropriate content within 1 second.

This allows unsurpassed response time

to avoid delays, and the ability to meet the upcoming dramatic scale we expect.

Despite the launch of Sample MD 2.0, attracting

and retaining users of our portals requires us to continue to improve the technology underlying those portals and to continue

to develop new and updated applications, features and services for those portals.

If we are unable to do so on a timely basis

or if we are unable to implement new applications, features and services without disruption to our existing ones, we may lose

potential users and clients.

The costs of development of these enhancements may negatively impact our ability to achieve profitability.

rely on a combination of internal development, strategic relationships, licensing and acquisitions to develop our portals and

related applications, features and services.

Our development and/or implementation of new technologies, applications, features

and services may cost more than expected, may take longer than originally expected, may require more testing than originally anticipated

and may require the acquisition of additional personnel and other resources.

There can be no assurance that the revenue opportunities

from any new or updated technologies, applications, features or services will justify the amounts spent.

we are unable to adhere to the regulatory and competitive climate in which we operate, we could be materially and negatively impacted.

to the labyrinth of regulations in healthcare space, state and federal, as well as political sensitivity of healthcare delivery

our business model could be negatively impacted or fail.

markets in which we operate are competitive, continually evolving and, in some cases, subject to rapid change.

portals face competition from numerous other companies, both in attracting users and

in generating revenue from advertisers and sponsors.

We compete for users with online

services and Web sites that provide savings on medications and healthcare products, including

both commercial sites and not-for-profit sites.

We compete for advertisers and sponsors

health-related web sites;

general purpose consumer web sites that offer specialized

health sub-channels;

other high-traffic web sites that include both healthcare-related

and non-healthcare-related content and services;

search engines that provide specialized

health search;

and advertising networks that aggregate traffic from multiple sites.

healthcare provider portals compete with:

providers of healthcare decision-support tools

and online health management applications;

wellness and disease management vendors;

health information services and health management offerings of healthcare benefits companies

and their affiliates.

of our competitors have greater financial, technical, product development, marketing and other resources than we do.

These organizations

may be better known than we are and have more customers or users than we do.

We cannot provide assurance that we will be able

to compete successfully against these organizations or any alliances they have formed or may form.

Since there are no substantial

barriers to entry into the markets in which our public portals participate, we expect that competitors will continue to enter

these markets.

in the healthcare industry could adversely affect our business

of our revenue is derived from the healthcare industry and could be affected by changes affecting healthcare spending.

particularly dependent on pharmaceutical, biotechnology and medical device companies for our advertising and sponsorship revenue.

reductions in expenditures by healthcare industry participants could result from, among other things:

regulation or private initiatives that affect the manner in which healthcare providers

interact with patients, payers or other healthcare industry participants, including changes

in pricing or means of delivery of healthcare products and services;

regulation prohibiting the use of coupons by patients covered by federally funded health

insurance programs;

● consolidation

of healthcare industry participants;

in governmental funding for healthcare;

changes in business or economic conditions affecting healthcare payers or providers,

pharmaceutical, biotechnology or medical device companies or other healthcare industry

participants.

if general expenditures by industry participants remain the same or increase, developments in the healthcare industry may result

in reduced spending in some or all of the specific market segments that we serve or are planning to serve.

For example, use of

our products and services could be affected by:

in the design of health insurance plans;

decrease in the number of new drugs or medical devices coming to market;

decrease in marketing expenditures by pharmaceutical or medical device companies, including

as a result of governmental regulation or private initiatives that discourage or prohibit

advertising or sponsorship activities by pharmaceutical or medical device companies.

addition, our customers’

expectations regarding pending or potential industry developments may also affect their budgeting

processes and spending plans with respect to products and services of the types we provide.

healthcare industry has changed significantly in recent years and we expect that significant changes will continue to occur.

the timing and impact of developments in the healthcare industry are difficult to predict.

We cannot assure you that the markets

for our products and services will continue to exist at current levels or that we will have adequate technical, financial and

marketing resources to react to changes in those markets.

we are embroiled in various lawsuits from time to time with uncertain consequences, the outcome of potential judgments may negatively

affect our financial condition and results of operations

are currently involved in litigation and other disputes, as described in Item 3 of this report.

As we continue to grow, we can

expect to have to deal with lawsuits that affect our business.

Lawsuits are uncertain and involve a substantial degree of risk.

If we are unable to successfully prosecute or defend these actions, our financial condition and results of operations could suffer.

success is dependent in part on obtaining, maintaining and enforcing our proprietary rights and our ability to avoid infringing

on the proprietary rights of others.

seek patent protection for those inventions and technologies for which we believe such protection is suitable and is likely to

provide a competitive advantage to us.

Because patent applications in the United States are maintained in secrecy until either

the patent application is published or a patent is issued, we may not be aware of third-party patents, patent applications and

other intellectual property relevant to our products that may block our use of our intellectual property or may be used in third-party

products that compete with our products and processes.

In the event a competitor or other party successfully challenges our products,

processes, patents or licenses or claims that we have infringed upon their intellectual property, we could incur substantial litigation

costs defending against such claims, be required to pay royalties, license fees or other damages or be barred from using the intellectual

property at issue, any of which could have a material adverse effect on our business, operating results and financial condition.

also rely substantially on trade secrets, proprietary technology, nondisclosure and other contractual agreements, and technical

measures to protect our technology, application, design, and manufacturing know-how, and work actively to foster continuing technological

innovation to maintain and protect our competitive position.

We cannot assure you that steps taken by us to protect our intellectual

property and other contractual agreements for our business will be adequate, that our competitors will not independently develop

or patent substantially equivalent or superior technologies or be able to design around patents that we may receive, or that our

intellectual property will not be misappropriated.

business will suffer if our network systems fail or become unavailable.

reduction in the performance, reliability and availability of our network infrastructure would harm our ability to distribute

our products to our users, as well as our reputation and ability to attract and retain customers.

Our systems and operations could

be damaged or interrupted by fire, flood, power loss, telecommunications failure, Internet breakdown, earthquake and similar events.

Our systems could also be subject to viruses, break-ins, sabotage, acts of terrorism, acts of vandalism, hacking, cyber-terrorism

and similar misconduct.

We might not carry adequate business interruption insurance to compensate us for losses that may occur

from a system outage.

Any system error or failure that causes interruption in availability of our product or an increase in response

time could result in a loss of potential customers, which could have a material adverse effect on our business, financial condition

and results of operations.

If we suffer sustained or repeated interruptions, then our products and services could be less attractive

to our users and our business would be materially harmed.

we are unable to manage growth, our operations could be adversely affected.

progress is expected to require the full utilization of our management, financial and other resources.

Our ability to manage growth

effectively will depend on our ability to improve and expand operations, including our financial and management information systems,

and to recruit, train and manage personnel.

Risks Relating to Our Business

Because we have historically experienced

losses, if we are unable to achieve profitability, our financial condition and company could suffer.

While we were profitable for the full year of

2021, since the inception of our business we have historically incurred losses as a result of investing in future growth.

losses in 2019 and 2020 as a result of our increased spending to build the organization to support expected future growth – both

through additional new hires, as well as through acquisitions.

While we have increased revenues significantly, we have not yet consistently

achieved profitability due to these investments and non-cash expenses.

Our ability to achieve consistent profitability depends on our

ability to generate sales through our technology platform and advertising model, while maintaining reasonable expense levels.

not achieve sustainable profitability, it may impact our ability to continue our operations.

The global pandemic may disrupt our business

or the business of our customers

In December 2019, a novel strain of corona virus,

which causes the infectious disease known as COVID-19 was reported.

The World Health Organization declared COVID-19 a Public Health Emergency

and Global Pandemic.

COVID-19 has had, and continues to have, a severe impact on economies around the world, in particular in the healthcare

industry in which we operate.

We have taken steps to modify our business practices and mitigate the impact of the pandemic on us, and

may take further precautions as required by government authorities or to protect the health of our employees, customer, and partners -

but there can be no assurance that such steps will be successful, or that our business operations, or the operations of our customers

or partners will not be materially and adversely affected by the consequences of the pandemic.

This could materially impact our results

of operations, cash flows, and financial condition.

We may be unable to support our technology

to further scale our operations successfully.

Our plan is to grow rapidly through further integration

of our technology in electronic platforms.

Our growth will place significant demands on our management and technology development, as

well as our financial, administrative and other resources.

We cannot guarantee that any of the systems, procedures and controls we put

in place will be adequate to support the commercialization of our operations.

Our operating results will depend substantially on the ability

of our officers and key employees to manage changing business conditions and to implement and improve our financial, administrative and

other resources.

If we are unable to respond to and manage changing business conditions, or the scale of our solutions, services and operations,

then the quality of our services, our ability to retain key personnel and our business could be harmed.

Developing and implementing new and updated

applications, features and services for our portals may be more difficult than expected, may take longer and cost more than expected and

may not result in sufficient increases in revenue to justify the costs.

Attracting and retaining users of our portals

requires us to continue to improve the technology underlying those portals and to continue to develop new and updated applications, features

and services for those portals.

If we are unable to do so on a timely basis or if we are unable to implement new applications, features

and services without disruption to our existing ones, we may lose potential users and clients.

The costs of development of these enhancements

may negatively impact our ability to achieve profitability.

We rely on a combination of internal development,

strategic relationships, licensing and acquisitions to develop our portals and related applications, features and services.

Our development

and/or implementation of new technologies, applications, features and services may cost more than expected, may take longer than originally

expected, may require more testing than originally anticipated and may require the acquisition of additional personnel and other resources.

There can be no assurance that the revenue opportunities from any new or updated technologies, applications, features or services will

justify the amounts spent.

Any failure to offer high-quality customer

support for our portals may adversely affect our relationships with our customers and harm our financial results.

Once our solutions are implemented, our customers

use our support organization to resolve technical issues relating to our solutions.

In addition, we also believe that our success in selling

our solutions is highly dependent on our business reputation and on favorable recommendations from our existing customers.

to maintain high-quality customer support, or a market perception that we do not maintain high-quality support, could harm our reputation,

adversely affect our ability to maintain existing customers or sell our solutions to existing and prospective customers, and harm our

business, operating results and financial condition.

We may be unable to respond quickly enough to

accommodate short-term increases in customer demand for support services.

Increased customer demand for these services, without corresponding

revenues, could also increase costs and adversely affect our operating results.

We are dependent on a concentrated group

of customers.

Our revenues are concentrated in less than 50

customers, primarily large pharmaceutical manufacturers.

Loss of one or more of our larger customers could have a negative impact on our

operating results.

In both 2021 and 2020, we had three customers that each represented slightly over 10% of our revenues;

one customer represented over 10% of our revenues in both years.

We expect that we will continue to depend upon

a relatively small number of customers for a significant portion of our total revenues for the foreseeable future.

The loss of any of

these customers or groups of customers for any reason, or a change of relationship with any of our key customers could cause a material

decrease in our total revenues.

Additionally, mergers or consolidations among

our customers in the healthcare industry could reduce the number of our customers and could adversely affect our revenues and sales.

particular, if our customers are acquired by entities that are not also our customers, that do not use our solutions or that have more

favorable contract terms with competitors and choose to discontinue, reduce or change the terms of their use of our solutions, our business

and operating results could be materially and adversely affected.

If we are unable to maintain our contracts

with electronic prescription platforms, our business will suffer.

We are reliant upon our contracts with leading

electronic prescribing platforms and electronic health record systems to generate our revenues received from customers Such arrangements

subject us to a number of risks, including the following:

● Our contract partners may experience financial, regulatory or operational difficulties, which may impair

their ability to focus on and fulfill their contract obligations to us;

● Legal disputes or disagreements, including the ownership of intellectual property, may occur with one

or more of our partners and may lead to lengthy and expensive litigation or arbitration;

● Significant changes in a partner’s business strategy may adversely affect a partner’s willingness

or ability to satisfy obligations under any such arrangement;

● A partner could terminate the partnership arrangement, which could negatively impact our ability to sell

our solutions and achieve revenues.

We will need to maintain these relationships as

well as diversify them.

The inability to do so could adversely impact our business.

We generated 53.9% and 52.7% of our revenue through

our largest partner in 2021 and 2020, respectively.

Our agreements with electronic prescription

platforms and electronic health record systems are subject to audit.

Our agreements with our partners provide for revenue

sharing payments to the platform partners based on the revenue we generate through the platform.

These payments are subject to audit by

our partners, at their cost, and if there is a dispute as to the calculation, we may be liable for additional payments.

If an underpayment

is determined to be in excess of a certain amount, for example 10%, some agreements would require us to pay for the cost of the audit,

Our future growth depends on our ability

to attract, retain customers, and the loss of existing customers, or failure to attract new ones, could adversely impact our business

and future prospects.

We currently work with many leading pharmaceutical

companies, medical device manufacturers, associations, and other companies.

While we have experienced customer growth, this growth may

not continue at the same pace in the future or at all.

Achieving growth in our customer base may require us to engage in increasingly

sophisticated and costly sales and marketing efforts that may not result in additional customers.

We may also need to modify our pricing

model to attract and retain such customers.

If we fail to attract new customers or fail to maintain or expand existing relationships in

a cost-effective manner, our business and future prospects may be materially and adversely impacted.

Actual or perceived failures to comply with

applicable laws and regulations that affect the healthcare industry, including data protection, privacy and security, fraud and abuse

laws, regulations, standards and other requirements could adversely affect our business, results of operations, and financial condition.

The global data protection landscape is rapidly

evolving, and we are or may become subject to numerous state, federal and foreign laws, requirements and regulations governing the collection,

use, disclosure, retention, and security of personal information, including health-related information.

This evolution may create uncertainty

in our business, affect our ability to operate in certain jurisdictions or to collect, store, transfer, use and share personal information,

necessitate the acceptance of more onerous obligations in our contracts, result in liability or impose additional costs on us.

of compliance with these laws, regulations and standards is high and is likely to increase in the future.

Any failure or perceived failure

by us to comply with federal, state or foreign laws or regulation, our internal policies and procedures or our contracts governing our

processing of personal information could result in negative publicity, government investigations and enforcement actions, claims by third

parties, and damage to our reputation, any of which could have a material adverse effect on our operations, financial performance and

We also may be bound by contractual obligations

and other obligations relating to privacy, data protection, and information security that are more stringent than applicable laws and

The costs of compliance with, and other burdens imposed by, laws, regulations, standards, and other obligations relating

to privacy, data protection, and information security are significant.

Although we work to comply with applicable laws, regulations, and

standards, our contractual obligations and other legal obligations, these requirements are evolving and may be modified, interpreted and

applied in an inconsistent manner from one jurisdiction to another, and may conflict with another or other legal obligations with which

we must comply.

Accordingly, our failure, or perceived inability, to comply with these laws, regulations, standards, and other obligations

may limit the use and adoption of our solution, reduce overall demand for our solution, lead to regulatory investigations, breach of contract

claims, litigation, and significant fines, penalties, or liabilities for actual or alleged noncompliance or slow the pace at which we

close sales transactions, any of which could harm our business.

The Health Insurance Portability and Accountability

Act of 1996, or HIPAA, and the rules promulgated thereunder require certain entities, referred to as Covered Entities, to comply with

established standards, including standards regarding the privacy and security of protected health information, or PHI.

HIPAA further requires

that Covered Entities enter into agreements meeting certain regulatory requirements with their business associates, as such term is defined

by HIPAA, which, among other things, obligate the business associates to safeguard the covered entity’s PHI against improper use

and disclosure.

While we are not a Covered Entity and not directly regulated by HIPAA, our customers or distributors might face significant

contractual liability pursuant to such an agreement if the business associate breaches the agreement or causes the Covered Entity to fail

to comply with HIPAA.

It is possible that HIPAA compliance could become a substantial regulatory burden and expense to our operations

as we expand our point of care technology solutions to help patients start and stay on therapies.

Certain other laws and regulations such as federal

and state anti-kickback and false claims laws may apply to us indirectly through our relationships with our customers and partners.

can result in considerable penalties and sanctions.

If we are found to have violated, or to have facilitated the violation of such laws,

we could be subject to significant penalties.

If we are unable to adhere to the regulatory

and competitive climate in which we operate, we could be materially and negatively impacted.

Due to the labyrinth of regulations in healthcare

space, state and federal, as well as political sensitivity of healthcare delivery, our business model could be negatively impacted or

The markets in which we operate are competitive,

continually evolving and, in some cases, subject to rapid change.

Our platforms face competition from numerous other

companies, both in attracting users and in generating revenue from advertisers and sponsors.

We compete for users with online services

and websites that provide savings on medications and healthcare products, including both commercial sites and not-for-profit sites.

compete for advertisers and sponsors with health-related web sites, general purpose consumer web sites that offer specialized health sub-channels,

other high-traffic web sites that include both healthcare-related and non-healthcare-related content and services, search engines that

provide specialized health searches, and advertising networks that aggregate traffic from multiple sites.

Many of our competitors have greater financial,

technical, product development, marketing and other resources than we do.

These organizations may be better known than we are and have

more customers or users than we do.

We cannot provide assurance that we will be able to compete successfully against these organizations

or any alliances they have formed or may form.

Since there are no substantial barriers to entry into the markets in which our public portals

participate, we expect that competitors will continue to enter these markets.

Developments in the healthcare industry

could adversely affect our business.

Most of our revenue is derived from the healthcare

industry and could be affected by changes affecting healthcare spending.

We are particularly dependent on pharmaceutical, biotechnology

and medical device companies for our advertising and sponsorship revenue.

General reductions in expenditures by healthcare

industry participants could result from, among other things:

● Government regulation or private initiatives that affect the manner in which healthcare providers interact

with patients, payers or other healthcare industry participants, including changes in pricing or means of delivery of healthcare products

and services;

● Government regulation prohibiting the use of coupons by patients covered by federally funded health insurance

● Consolidation of healthcare industry participants;

● Reductions or changes in governmental funding for healthcare;

● Adverse changes in business or economic conditions affecting healthcare payers or providers, pharmaceutical,

biotechnology or medical device companies or other healthcare industry participants.

Even if general expenditures by industry participants

remain the same or increase, developments in the healthcare industry may result in reduced spending in some or all of the specific market

segments that we serve or are planning to serve.

For example, use of our solutions and services could be affected by:

● Changes in the design of health insurance plans;

● A decrease in the number of new drugs or medical devices coming to market;

● A decrease in marketing expenditures by pharmaceutical or medical device companies, including as a result

of governmental regulation or private initiatives that discourage or prohibit advertising or sponsorship activities by pharmaceutical

or medical device companies;

● Payor pressure to move to generic brands.

In addition, our customers’ expectations

regarding pending or potential industry developments may also affect their budgeting processes and spending plans with respect to solutions

and services of the types we provide.

The healthcare industry has changed significantly

in recent years and we expect that significant changes will continue to occur.

However, the timing and impact of developments in the healthcare

industry are difficult to predict.

We cannot assure you that the markets for our solutions and services will continue to exist at current

levels or that we will have adequate technical, financial and marketing resources to react to changes in those markets.

If we are unable to manage growth, our operations

could be adversely affected.

Our ability to manage growth effectively will

depend on our ability to improve and expand operations, including our financial and management information systems, and to recruit, train

and manage personnel.

There can be no absolute assurance that management will be able to manage growth effectively.

we do not properly manage the growth of our business, we may experience significant strains on our management and operations and

disruptions in our business.

Various risks arise when companies and industries grow quickly.

If our business or industry grows

too quickly, our ability to meet customer demand in a timely and efficient manner could be challenged.

We may also experience

development delays as we seek to meet increased demand for our products.

Our failure to properly manage the growth that we or

our industry might experience could negatively impact our ability to execute on our operating plan and, accordingly, could have

an adverse impact on our business, our cash flow and results of operations, and our reputation with our current or potential customers.

business is subject to changing regulation of corporate governance and public disclosure

Because our common stock is publicly

traded, we are subject to certain rules and regulations of federal and state entities charged with the protection of investors

and the oversight of companies whose securities are publicly traded.

These entities have continued to develop additional regulations

and requirements in response to laws enacted by Congress, most notably the Sarbanes-Oxley Act of 2002.

Complying with these new

regulations has resulted in, and is likely to continue to result in, increased general and administrative costs and a diversion

of management time and attention from revenue generating and other business activities to compliance activities.

Relating to Our Securities

a market for our common stock does not develop, shareholders may be unable to sell their shares.

common stock is quoted under the symbol “OPRX”

on the OTCQB operated by OTC Markets Group, Inc., an electronic inter-dealer

quotation medium for equity securities.

We do not currently have an active trading market.

There can be no assurance that an active

and liquid trading market will develop or, if developed, that it will be sustained.

securities are very thinly traded.

Accordingly, it may be difficult to sell shares of our common stock without significantly depressing

the value of the stock.

Unless we are successful in developing continued investor interest in our stock, sales of our stock could

continue to result in major fluctuations in the price of the stock.

we are subject to the “Penny Stock”

rules, the level of trading activity in our stock may be reduced.

Securities and Exchange Commission has adopted regulations which generally define "penny stock"

to be any listed, trading

equity security that has a market price less than $5.00 per share or an exercise price of less than $5.00 per share, subject to

certain exemptions.

The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt

from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the risks

in the penny stock market.

The broker-dealer must also provide the customer with current bid and offer quotations for the penny

stock, the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing the

market value of each penny stock held in the customer’s account.

In addition, the penny stock rules generally require that

prior to a transaction in a penny stock, the broker-dealer make a special written determination that the penny stock is a suitable

investment for the purchaser and receive the purchaser’s written agreement to the transaction.

These disclosure requirements

may have the effect of reducing the level of trading activity in the secondary market for a stock that becomes subject to the

penny stock rules which may increase the difficulty Purchasers may experience in attempting to liquidate such securities.

do not expect to pay dividends in the foreseeable future.

Any return on investment may be limited to the value of our common stock.

do not anticipate paying cash dividends on our common stock in the foreseeable future.

The payment of dividends on our common

stock will depend on earnings, financial condition and other business and economic factors affecting it at such time as the board

of directors may consider relevant.

If we do not pay dividends, our common stock may be less valuable because a return on your

investment will occur only if our stock price appreciates.

in the Nevada Revised Statutes and our Bylaws could make it very difficult for an investor to bring any legal actions against

our directors or officers for violations of their fiduciary duties or could require us to pay any amounts incurred by our directors

or officers in any such actions.

of our board of directors and our officers will have no liability for breaches of their fiduciary duty of care as a director or

officer, except in limited circumstances, pursuant to provisions in the Nevada Revised Statutes and our Bylaws as authorized by

the Nevada Revised Statutes.

Specifically, Section 78.138 of the Nevada Revised Statutes provides that a director or officer is

not individually liable to the company or its shareholders or creditors for any damages as a result of any act or failure to act

in his or her capacity as a director or officer unless it is proven that (1) the director’s or officer’s act or failure

to act constituted a breach of his or her fiduciary duties as a director or officer and (2) his or her breach of those duties

involved intentional misconduct, fraud or a knowing violation of law.

This provision is intended to afford directors and officers

protection against and to limit their potential liability for monetary damages resulting from suits alleging a breach of the duty

of care by a director or officer.

Accordingly, you may be unable to prevail in a legal action against our directors or officers

even if they have breached their fiduciary duty of care.

In addition, our Bylaws allow us to indemnify our directors and officers

from and against any and all costs, charges and expenses resulting from their acting in such capacities with us.

This means that

if you were able to enforce an action against our directors or officers, in all likelihood, we would be required to pay any expenses

they incurred in defending the lawsuit and any judgment or settlement they otherwise would be required to pay.

Accordingly, our

indemnification obligations could divert needed financial resources and may adversely affect our business, financial condition,

results of operations and cash flows, and adversely affect prevailing market prices for our common stock.

To manage growth effectively,

we will be required to continue to implement and improve our operating and financial systems and controls to expand, train and manage

our employee base.

Our ability to manage our operations and growth effectively will require us to continue to expend funds to enhance

our operational, financial and management controls, reporting systems and procedures, and to attract and retain sufficient talented personnel.

If we do not properly manage the growth of our

business, we may experience significant strains on our management and operations and disruptions in our business.

Various risks arise

when companies grow too quickly.

If our business grows too quickly, our ability to meet customer demand in a timely and efficient manner

could be challenged.

We may also experience development delays as we seek to meet increased demand for our solutions.

Our failure to properly

manage the growth that we or our industry might experience could negatively impact our ability to execute on our operating plan and, accordingly,

could have an adverse impact on our business, our cash flow and results of operations, and our reputation with our current or potential

Our growth may be impacted by acquisitions.

We may not be able to identify suitable acquisition candidates, complete acquisitions or integrate acquisitions successfully.

Our future growth is likely to depend to some

degree on our ability to acquire and successfully integrate new businesses.

We may not be able to identify suitable acquisition candidates,

complete acquisitions, or integrate acquisitions successfully.

We may seek additional acquisition opportunities, both to further diversify

our business and to penetrate or expand important product offerings or markets.

There are no assurances, however, that we will be able

to successfully identify suitable candidates, negotiate appropriate terms, obtain financing on acceptable terms, complete proposed acquisitions,

successfully integrate acquired businesses, or expand into new markets.

Once acquired, operations may not achieve anticipated levels of

revenues or profitability.

Acquisitions involve risks, including difficulties in the integration of the operations, technologies, services

and products of the acquired companies and the diversion of management’s attention from other business concerns.

Although our management

will endeavor to evaluate the risks inherent in any particular transaction, there are no assurances that we will properly ascertain all

Difficulties encountered with acquisitions could have a material adverse impact on our business.

Our business and growth may suffer if we

are unable to attract and retain key employees.

Our success has been largely dependent on the

skills, experience and efforts of our key employees and the loss of the services of any of our executive officers or other key employees,

without a properly executed transition plan, could have an adverse effect on us.

The loss of any member of our senior management team

or any of our other key employees could damage critical customer relationships, result in the loss of vital knowledge, experience and

expertise, could lead to an increase in recruitment and training costs and make it more difficult to successfully operate our business

and execute our business strategy.

We may not be able to find qualified potential replacements for these individuals and the integration

of potential replacements may be disruptive to our business.

Furthermore, our ability to expand operations

to accommodate our anticipated growth will also depend on our ability to attract and retain qualified media, management, finance, marketing,

sales and technical personnel.

However, competition for these types of employees is intense due to the limited number of qualified professionals.

Our ability to meet our business development objectives will depend in part on our ability to recruit, train and retain top quality people

with advanced skills who understand our technology and business.

If we are unable to engage and retain the necessary personnel, our business

may be materially and adversely affected.

We could be subject to economic, political,

regulatory and other risks arising from our international operations.

Operating in international markets requires significant

resources and management attention and will subject us to regulatory, economic and political risks that may be different from and incremental

to those in the United States.

In addition to the risks that we face in the United States, our international operations in Israel and

Croatia, may involve risks that could adversely affect our business, including:

● difficulties and costs associated with staffing and managing foreign operations;

● natural or man-made disasters, political, social and economic instability, including wars, terrorism and

political unrest, outbreak of disease (such as the recent outbreak of the novel coronavirus, or COVID-19), boycotts, curtailment of trade,

and other business restrictions;

● compliance with United States laws, such as the Foreign Corrupt Practices Act, export controls and economic

sanctions, and local laws prohibiting corrupt payments to government officials;

● unexpected changes in regulatory requirements;

● less favorable foreign intellectual property laws;

● adverse tax consequences such as those related to repatriation of cash from foreign jurisdictions into

the United States, non-income related taxes such as value-added tax or other indirect taxes, changes in tax laws or their interpretations,

or the application of judgment in determining our global provision for income taxes and other tax liabilities given inter-company transactions

and calculations where the ultimate tax determination is uncertain;

● fluctuations in currency exchange rates, which could impact revenues and expenses of our international

operations and expose us to foreign currency exchange rate risk;

● profit repatriation and other restrictions on the transfer of funds;

● differing payment processing systems as well as consumer use and acceptance of electronic payment methods,

such as payment cards;

● new and different sources of competition;

● different and more stringent user protection, data protection, privacy and other laws;

● availability of reliable broadband connectivity and wide area networks in targeted areas for expansion.

Our failure to manage any of these risks successfully

could harm our international operations and our overall business, as well as results of our operations.

Risks Related to Our Intellectual Property

and Technology

We are dependent, in part, on our intellectual

If we are not able to protect our proprietary rights or if those rights are invalidated or circumvented, our business may be

adversely affected.

Our business is dependent, in part, on our ability

to innovate, and, as a result, we are reliant on our intellectual property.

We generally protect our intellectual property through patents,

trademarks, trade secrets, confidentiality and nondisclosure agreements and other measures to the extent our budget permits.

be no assurance that patents will be issued from pending applications that we have filed or that our patents will be sufficient to protect

our key technology from misappropriation or falling into the public domain, nor can assurances be made that any of our patents, patent

applications, trademarks or our other intellectual property or proprietary rights will not be challenged, invalidated or circumvented.

In the event a competitor or other party successfully challenges our solutions, processes, patents or licenses or claims that we have

infringed upon their intellectual property, we could incur substantial litigation costs defending against such claims, be required to

pay royalties, license fees or other damages or be barred from using the intellectual property at issue, any of which could have a material

adverse effect on our business, operating results and financial condition.

We cannot assure you that steps taken by us to protect our

intellectual property and other contractual agreements for our business will be adequate, that our competitors will not independently

develop or patent substantially equivalent or superior technologies or be able to design around patents that we may receive, or that our

intellectual property will not be misappropriated.

If we are unable to protect our proprietary rights,

we may be at a disadvantage to others who do not incur the substantial time and expense we incur.

Preventing unauthorized use or infringement

of our intellectual property rights is inherently difficult.

Moreover, it may be difficult or practically impossible to detect theft or

unauthorized use of our intellectual property.

Any of the foregoing could have a material adverse effect upon our business, financial

condition and results of operations.

Cybersecurity incidents could disrupt business

operations, result in the loss of critical and confidential information, and adversely impact our reputation and results of operations.

Global cybersecurity threats can range from uncoordinated

individual attempts to gain unauthorized access to our information technology (IT) systems to sophisticated and targeted measures known

as advanced persistent threats.

While we employ comprehensive measures to prevent, detect, address and mitigate these threats (including

access controls, insurance, vulnerability assessments, continuous monitoring of our IT networks and systems, maintenance of backup and

protective systems and user training and education), cybersecurity incidents, depending on their nature and scope, could potentially result

in the misappropriation, destruction, corruption or unavailability of critical data and confidential or proprietary information (our own

or that of third parties) and the disruption of business operations.

The potential consequences of a material cybersecurity incident include

reputational damage, loss of customers, litigation with customers and other parties, loss of trade secrets and other proprietary business

data and increased cybersecurity protection and remediation costs, which in turn could adversely affect our competitiveness and results

of operations.

Our business will suffer if our network

systems fail or become unavailable.

A reduction in the performance, reliability and

availability of our network infrastructure would harm our ability to distribute our solutions to our users, as well as our reputation

and ability to attract and retain customers.

Our systems and operations could be damaged or interrupted by fire, flood, power loss, telecommunications

failure, Internet breakdown, earthquake and similar events.

Our systems could also be subject to viruses, break-ins, sabotage, acts of

terrorism, acts of vandalism, hacking, cyber-terrorism and similar misconduct.

We might not carry adequate business interruption insurance

to compensate us for losses that may occur from a system outage.

Any system error or failure that causes interruption in availability

of our solutions or an increase in response time could result in a loss of potential customers, which could have a material adverse effect

on our business, financial condition and results of operations.

If we suffer sustained or repeated interruptions, then our solutions and

services could be less attractive to our users and our business would be materially harmed.

Risks Relating to Our Common Stock

If a market for our common stock is not

maintained, shareholders may be unable to sell their shares.

Our common stock is traded under the symbol “OPRX”

on the Nasdaq Capital Market.

We do not currently have a consistent active trading market.

There can be no assurance that a consistent

active and liquid trading market will develop or, if developed, that it will be sustained.

Historically, our securities have been thinly

Accordingly, it may be difficult to sell shares of our common stock without significantly depressing the value of the stock.

we are successful in developing continued investor interest in our stock, sales of our stock could continue to result in major fluctuations

in the price of the stock.

The market price of our common stock is

likely to be highly volatile and could fluctuate widely in price in response to various factors, many of which are beyond our control.

Our stock price is subject to a number of factors,

● Technological innovations or new solutions and services by us or our competitors;

● Government regulation of our solutions and services;

● The establishment of partnerships with other healthcare companies;

● Intellectual property disputes;

● Additions or departures of key personnel;

● Sales of our common stock;

● Our ability to execute our business plan;

● Operating results below or exceeding expectations;

● Our operating and financial performance and prospects;

● Loss or addition of any strategic relationship;

● General financial, domestic, international, economic, industry and other market trends or conditions;

● Period-to-period fluctuations in our financial results.

Our stock price may fluctuate widely as a result

of any of the above.

In addition, the securities markets have from time to time experienced significant price and volume fluctuations

that are unrelated to the operating performance of particular companies.

These market fluctuations may also materially and adversely affect

the market price of our common stock.

We do not expect to pay dividends in the

foreseeable future and any return on investment may be limited to the value of our common stock.

We have never declared or paid any cash dividends

on our common stock.

We currently intend to retain all available funds and future earnings, if any, to fund our future growth and do not

expect to declare or pay any dividend on shares of our common stock in the foreseeable future.

As a result, the success of an investment

in our common stock may depend entirely upon any future appreciation in its value.

There is no guarantee that our common stock will appreciate

in value or even maintain the price at which it was purchased.

Anti-takeover” provisions may make it

more difficult for a third party to acquire control of us, even if the change in control would be beneficial to shareholders.

The Company is a Nevada corporation.

Anti-takeover

provisions in Nevada law and our charter and bylaws could make it more difficult for a third party to acquire control of us.

These provisions

could adversely affect the market price of the common stock and could reduce the amount that shareholders might receive if the Company

For example, our charter provides that the board of directors may issue preferred stock without shareholder approval.

our bylaws provide that shareholders cannot act by written consent and that directors may be removed by shareholders only with the approval

of the holders of not less than two-thirds of the voting power of the issued and outstanding stock entitled to vote at an annual or special

meeting of the shareholders.

Risks Related to Being a Public Company

We have identified

a material weakness in our internal control over financial reporting.

Failure to remediate the material weakness or any other material

weaknesses that we identify in the future could result in material misstatements in our financial statements.

Pursuant to Section 404

of the Sarbanes-Oxley Act of 2002, as amended, our management is required to report on the effectiveness of our internal control over

financial reporting.

The rules governing the standards that must be met for management to assess our internal control over financial reporting

are complex and require significant documentation, testing and possible remediation.

Annually, we perform activities that include reviewing,

documenting and testing our internal control over financial reporting.

In addition, if we fail to maintain the adequacy of our internal

control over financial reporting, we will not be able to conclude on an ongoing basis that we have effective internal control over financial

reporting in accordance with Section 404 of the Sarbanes-Oxley Act of 2002.

If we fail to achieve and maintain an effective internal control

environment, we could suffer misstatements in our financial statements and fail to meet our reporting obligations, which would likely

cause investors to lose confidence in our reported financial information.

This could result in significant expenses to remediate any internal

control deficiencies and lead to a decline in our stock price.

Subsequent to the Original

Filing, the Company has re-evaluated the effectiveness of the Company’s disclosure controls and procedures and internal control

over financial reporting and identified a material weakness in the Company’s internal control over financial reporting.

weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable

possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected

on a timely basis.

For further discussion of the material weakness, see Item 9A, Controls and Procedures.

We cannot provide assurance

that we have identified all, or that we will not in the future have additional, material weaknesses in our internal control over financial

As a result, we may be required to implement further remedial measures and to design enhanced processes and controls to address

deficiencies.

If we do not effectively remediate the material weakness identified by management and maintain adequate internal controls

over financial reporting in the future, we may not be able to prepare reliable financial reports and comply with our reporting obligations

under the Exchange Act on a timely basis.

Any such delays in the preparation of financial reports and the filing of our periodic reports

may result in a loss of public confidence in the reliability of our financial statements, which, in turn, could materially adversely affect

our business, the market value of our common stock and our access to capital markets.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K/A

Item 1A. Risk Factors