LifeMD Reports Second Quarter 2024 Results

• Revenue increased 41% year-over-year to $50.7 million with telehealth revenue up 67%
• Telehealth achieved standalone profitability one quarter ahead of guidance, with adjusted EBITDA of $820,000
• Weight management subscribers exceeded 60,000 as of June 30, 2024
• Adjusted EBITDA increased 44% to $2.5 million
• Cash of $35.7 million as of June 30, 2024, and positive net cash flow in three of the last four quarters
  

Conference call begins at 4:30 p.m. Eastern time today

NEW YORK, Aug. 07, 2024 (GLOBE NEWSWIRE) -- LifeMD, Inc. (Nasdaq: LFMD), a leading provider of virtual primary care services, today reported financial results for the three and six months ended June 30, 2024.

Management Commentary

“LifeMD’s core telehealth business had a very strong quarter, led by continued outperformance in our GLP-1 weight management offering. Telehealth revenue increased 67% over the prior year and our patient subscriber base grew to approximately 254,000 by quarter end. Importantly, our telehealth business became profitable on an adjusted EBITDA basis, one quarter ahead of guidance,” said Justin Schreiber, Chairman and CEO of LifeMD. “The demand we continue to generate for our virtual care services and pharmacy offerings is indicative of the significant market opportunity that exists for the convenient and affordable access to high-quality healthcare our telehealth platform and affiliated medical group offers. What we continue to demonstrate, quarter over quarter, is that we have a sustainable and now profitable business that is well positioned to leverage the transformational shift that is occurring in how consumers access healthcare.”

“WorkSimpli’s performance during the quarter was pressured by an unexpectedly challenging advertising environment for its products and executional issues, which have since been addressed by their leadership. Based on its current operational performance and following recent strategic efforts, we expect WorkSimpli’s financial results to improve in the second half of the year, and to return to peak profitability by year-end 2024 on a monthly run-rate basis with significant growth in 2025. While we remain confident in our ability to monetize this non-core asset, we expect our core telehealth business will be the driving force of long-term growth in revenue and profitability,” he added.

“We are extremely pleased with the performance of our telehealth business, which led to positive net cash flow for LifeMD on a consolidated basis. On a standalone basis, this business posted cash flow from operations of approximately $3 million for the quarter and generated positive adjusted EBITDA,” commented Marc Benathen, Chief Financial Officer of LifeMD. “Our core telehealth business’ performance continues to be ahead of expectations and, as such, we are raising our 2024 telehealth revenue guidance to $150 million from $140 million previously and are introducing adjusted EBITDA guidance for telehealth of $3 to $4 million, both ahead of previous expectations. Despite the outperformance of telehealth, due to WorkSimpli’s first half results we are revising 2024 consolidated adjusted EBITDA guidance to $13 million to $15 million, with no change to consolidated revenue guidance. We remain bullish on the consolidated business led by our core telehealth platform, which remains well positioned as the long-term growth driver.”

Second Quarter Financial Highlights

• Revenue increased 41% year-over-year to $50.7 million with telehealth revenue up 67% versus the year-ago period.
• Telehealth active subscribers increased 32% over the year-ago period to approximately 254,000 at quarter-end.
• WorkSimpli active subscribers declined 8% versus the year-ago period driven by softness in first half 2024 customer acquisition.
• Weight management revenue grew 82% versus the first quarter of 2024.
• Gross margin expanded to 90%, up from 87% in the year-ago period.
• GAAP net loss was $7.7 million or $0.19 per share, compared with GAAP net loss of $7.5 million or $0.23 per share in the year-ago period.
• Adjusted EBITDA was $2.5 million compared with $1.7 million in the year-ago period (see definition below of this non-GAAP financial measure and reconciliation to GAAP).
• Telehealth achieved adjusted EBITDA of $820,000, reaching profitability one quarter ahead of guidance (see definition below of this non-GAAP financial measure and reconciliation to GAAP).
• Adjusted diluted EPS was $0.06 compared with $0.05 in the year-ago period (see definition below of this non-GAAP financial measure and reconciliation to GAAP).
• Cash and cash equivalents were $35.7 million as of June 30, 2024.

Second Quarter Key Performance Metrics

($ in 000s)	Three Months Ended June 30,								Y-o-Y
Key Performance Metrics	2024				2023				% Growth
Revenue
Telehealth	$	37,432			$	22,351			67	%
WorkSimpli	$	13,230			$	13,596			-3	%
Total Revenue	$	50,662			$	35,947			41	%
Subscription Revenue as % of Total		96	%			95	%		1	%
Active Subscribers
Telehealth Active Subscribers		253,759				192,667			32	%
WorkSimpli Active Subscribers		158,514				171,775			-8	%
Total Active Subscribers		412,273				364,442			13	%

Financial Guidance

For the third quarter of 2024, the Company expects:

• Revenue of $53 million to $54 million, with telehealth revenue of $39.5 million to $40.5 million and WorkSimpli revenue of approximately $13.5 million.
• Adjusted EBITDA of $3.0 million to $4.0 million, with telehealth adjusted EBITDA of $500,000 to $1.5 million and WorkSimpli adjusted EBITDA of approximately $2.5 million.

For the full year 2024, the Company expects:

• Revenue of at least $205 million, unchanged from previous guidance, with telehealth revenue guidance increasing to $150 million from $140 million and WorkSimpli revenue guidance decreasing to $55 million from $65 million.
• Adjusted EBITDA of $13 million to $15 million, from $18 million to $22 million previously, with telehealth adjusted EBITDA of $3 million to $4 million and WorkSimpli adjusted EBITDA of $10 million to $11 million. This revised guidance is solely due to lower-than-expected customer acquisition at WorkSimpli, with telehealth outperforming previous expectations.

Conference Call

LifeMD’s management will host a conference call today at 4:30 p.m. Eastern time to discuss the Company’s financial results and outlook, and answer questions. Details for the call are as follows:

Toll-free dial-in number:	800-245-3047
International dial-in number:	203-518-9765
Conference ID:	LIFEMD

A live and archived webcast will be available in the Investors section of the Company’s website at ir.lifemd.com.

About LifeMD

LifeMD is a leading provider of virtual primary care. LifeMD offers telemedicine, access to laboratory and pharmacy services, and specialized treatment across more than 200 conditions, including primary care, men’s and women's health, weight management, and hormone therapy. The Company leverages a vertically-integrated, proprietary digital care platform, a 50-state affiliated medical group, and a U.S.-based patient care center to increase access to high-quality and affordable care. For more information, please visit LifeMD.com.

Cautionary Note Regarding Forward Looking Statements

This news release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended; Section 21E of the Securities Exchange Act of 1934, as amended; and the safe harbor provision of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements contained in this news release may be identified by the use of words such as: “believe,” “expect,” “anticipate,” “project,” “should,” “plan,” “will,” “may,” “intend,” “estimate,” predict,” “continue,” and “potential,” or, in each case, their negative or other variations or comparable terminology referencing future periods. Examples of forward-looking statements include, but are not limited to, statements regarding our financial outlook and guidance, short and long-term business performance and operations, future revenues and earnings, regulatory developments, legal events or outcomes, ability to comply with complex and evolving regulations, market conditions and trends, new or expanded products and offerings, growth strategies, underlying assumptions, and the effects of any of the foregoing on our future results of operations or financial condition.

Forward-looking statements are not historical facts and are not assurances of future performance. Rather, these statements are based on our current expectations, beliefs, and assumptions regarding future plans and strategies, projections, anticipated and unanticipated events and trends, the economy, and other future conditions, including the impact of any of the aforementioned on our future business. As forward-looking statements relate to the future, they are subject to inherent risk, uncertainties, and changes in circumstances and assumptions that are difficult to predict, including some of which are out of our control. Consequently, our actual results, performance, and financial condition may differ materially from those indicated in the forward-looking statements. These risks and uncertainties include, but are not limited to, “Risk Factors” identified in our filings with the Securities and Exchange Commission, including, but not limited to, our most recently filed Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and any amendments thereto. Even if our actual results, performance, or financial condition are consistent with forward-looking statements contained in such filings, they may not be indicative of our actual results, performance, or financial condition in subsequent periods.

Any forward-looking statement made in the news release is based on information currently available to us as of the date on which this release is made. We undertake no obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as may be required under applicable law or regulation.

Investor Contact
LifeMD, Inc.
Marc Benathen, Chief Financial Officer
marc@lifemd.com

Media Contact
Jessica Friedeman, Chief Marketing Officer
press@lifemd.com

Tables to Follow
++++++

LIFEMD, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
	June 30, 2024				December 31, 2023
	(Unaudited)
ASSETS
Current Assets
Cash	$	35,703,215			$	33,146,725
Accounts receivable, net		5,667,942				5,277,250
Product deposit		116,134				485,850
Inventory, net		2,060,719				2,759,932
Other current assets		1,521,420				934,510
Total Current Assets		45,069,430				42,604,267
Non-current Assets
Equipment, net		1,123,582				476,303
Right of use assets		2,534,731				594,897
Capitalized software, net		12,573,579				11,795,979
Intangible assets, net		2,519,167				3,009,263
Total Non-current Assets		18,751,059				15,876,442
Total Assets	$	63,820,489			$	58,480,709
LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities
Accounts payable	$	15,051,729			$	11,084,855
Accrued expenses		14,751,501				13,937,494
Notes payable, net		13,020				327,597
Current operating lease liabilities		337,276				603,180
Current portion of long-term debt		6,333,333				-
Deferred revenue		15,161,659				8,828,598
Total Current Liabilities		51,648,518				34,781,724
Long-term Liabilities
Long-term debt, net		11,795,281				17,927,727
Noncurrent operating lease liabilities		2,336,194				73,849
Contingent consideration		100,000				131,250
Total Liabilities		65,879,993				52,914,550
Commitments and Contingencies
Mezzanine Equity
Preferred Stock, $0.0001 par value; 5,000,000 shares authorized Series B Convertible Preferred Stock, $0.0001 par value; 5,000 shares authorized, zero shares issued and outstanding, liquidation value, $0 per share as of June 30, 2024 and December 31, 2023		-				-
Stockholders’ Equity (Deficit)
Series A Preferred Stock, $0.0001 par value; 1,610,000 shares authorized, 1,400,000 shares issued and outstanding, liquidation value approximately $25.55 per share as of June 30, 2024 and December 31, 2023		140				140
Common Stock, $0.01 par value; 100,000,000 shares authorized, 41,759,572 and 38,358,641 shares issued, 41,656,532 and 38,255,601 outstanding as of June 30, 2024 and December 31, 2023, respectively		417,596				383,586
Additional paid-in capital		225,001,992				217,550,583
Accumulated deficit		(229,462,356	)			(214,265,236	)
Treasury stock, 103,040 shares, at cost, as of June 30, 2024 and December 31, 2023		(163,701	)			(163,701	)
Total LifeMD, Inc. Stockholders’ (Deficit) Equity		(4,206,329	)			3,505,372
Non-controlling interest		2,146,825				2,060,787
Total Stockholders’ (Deficit) Equity		(2,059,504	)			5,566,159
Total Liabilities, Mezzanine Equity and Stockholders’ Equity (Deficit)	$	63,820,489			$	58,480,709

LIFEMD, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
	Three Months Ended June 30,								Six Months Ended June 30,
	2024				2023				2024				2023
Revenues
Telehealth revenue, net	$	37,432,309			$	22,351,128			$	68,273,711			$	42,553,931
WorkSimpli revenue, net		13,229,536				13,595,785				26,532,398				26,519,317
Total revenues, net		50,661,845				35,946,913				94,806,109				69,073,248
Cost of revenues
Cost of telehealth revenue		4,553,843				4,125,945				8,748,438				8,046,126
Cost of WorkSimpli revenue		471,072				422,485				876,654				717,273
Total cost of revenues		5,024,915				4,548,430				9,625,092				8,763,399
Gross profit		45,636,930				31,398,483				85,181,017				60,309,849
Expenses
Selling and marketing expenses		26,378,928				19,567,903				50,552,808				36,285,548
General and administrative expenses		18,521,385				12,119,573				33,827,117				22,722,336
Customer service expenses		2,733,418				1,912,078				4,581,459				3,467,482
Other operating expenses		1,906,175				1,313,789				4,206,622				3,018,554
Development costs		2,402,590				1,380,686				4,489,822				2,564,285
Total expenses		51,942,496				36,294,029				97,657,828				68,058,205
Operating loss		(6,305,566	)			(4,895,546	)			(12,476,811	)			(7,748,356	)
Other expenses
Interest expense, net		(531,468	)			(995,670	)			(1,009,146	)			(1,260,135	)
Loss on debt extinguishment		-				-				-				(325,198	)
Net loss		(6,837,034	)			(5,891,216	)			(13,485,957	)			(9,333,689	)
Net income attributable to noncontrolling interests		38,606				841,784				158,038				1,407,767
Net loss attributable to LifeMD, Inc.		(6,875,640	)			(6,733,000	)			(13,643,995	)			(10,741,456	)
Preferred stock dividends		(776,562	)			(776,562	)			(1,553,125	)			(1,553,125	)
Net loss attributable to LifeMD, Inc. common stockholders	$	(7,652,202	)		$	(7,509,562	)		$	(15,197,120	)		$	(12,294,581	)
Basic loss per share attributable to LifeMD, Inc. common stockholders	$	(0.19	)		$	(0.23	)		$	(0.38	)		$	(0.38	)
Diluted loss per share attributable to LifeMD, Inc. common stockholders	$	(0.19	)		$	(0.23	)		$	(0.38	)		$	(0.38	)
Weighted average number of common shares outstanding:
Basic		41,296,042				32,560,035				40,269,139				32,189,954
Diluted		41,296,042				32,560,035				40,269,139				32,189,954

LIFEMD, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
	Three Months Ended June 30,								Six Months Ended June 30,
	2024				2023				2024				2023
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(6,837,034	)		$	(5,891,216	)		$	(13,485,957	)		$	(9,333,689	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Amortization of debt discount		100,444				115,381				200,888				153,842
Amortization of capitalized software		1,937,708				1,260,022				3,725,112				2,348,667
Amortization of intangibles		246,066				245,968				492,032				479,528
Accretion of consideration payable		-				48,738				13,644				114,216
Depreciation of fixed assets		104,451				48,783				170,366				96,434
Loss (gain) on debt extinguishment		-				-				-				325,198
Operating lease payments		184,588				186,095				391,397				370,428
Stock compensation expense		4,191,176				2,861,969				6,735,606				5,525,483
Changes in Assets and Liabilities
Accounts receivable		(331,451	)			(731,544	)			(390,692	)			(833,793	)
Product deposit		172,804				11,164				369,716				(107,850	)
Inventory		312,921				(315,720	)			699,213				5,061
Other current assets		(222,683	)			401,868				(586,910	)			14,827
Operating lease liabilities		(130,846	)			(194,531	)			(334,790	)			(388,077	)
Deferred revenue		1,958,902				(227,335	)			6,333,061				120,704
Accounts payable		2,656,697				2,690,345				3,966,874				(513,414	)
Accrued expenses		196,020				4,134,337				1,442,362				4,232,140
Other operating activity		-				-				-				(579,319	)
Net cash provided by operating activities		4,539,763				4,644,324				9,741,922				2,030,386
CASH FLOWS FROM INVESTING ACTIVITIES
Cash paid for capitalized software costs		(2,488,039	)			(2,121,869	)			(4,502,712	)			(3,899,852	)
Purchase of equipment		(642,053	)			(30,563	)			(817,645	)			(64,219	)
Purchase of intangible assets		(1,936	)			(148,868	)			(1,936	)			(148,868	)
Net cash used in investing activities		(3,132,028	)			(2,301,300	)			(5,322,293	)			(4,112,939	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term debt, net		-				-				-				14,473,002
Proceeds from notes payable		-				-				-				2,000,000
Repayment of notes payable, net of prepayment penalty		(102,887	)			(1,086,956	)			(314,577	)			(4,386,915	)
Cash proceeds from exercise of options		100,000				-				107,813				-
Preferred stock dividends		(776,562	)			(776,562	)			(1,553,125	)			(1,553,125	)
Contingent consideration payment for ResumeBuild		-				(62,500	)			(31,250	)			(125,000	)
Net payments for membership interest of WorkSimpli		-				889				-				(305,625	)
Distributions to non-controlling interest		(36,000	)			(36,000	)			(72,000	)			(72,000	)
Net cash (used in) provided by financing activities		(815,449	)			(1,961,129	)			(1,863,139	)			10,030,337
Net increase in cash		592,286				381,895				2,556,490				7,947,784
Cash at beginning of period		35,110,929				11,524,846				33,146,725				3,958,957
Cash at end of period	$	35,703,215			$	11,906,741			$	35,703,215			$	11,906,741
Cash paid for interest
Cash paid during the period for interest	$	637,788			$	495,188			$	1,282,707			$	768,188
Non-cash investing and financing activities:
Cashless exercise of options	$	4,486			$	165			$	5,127			$	165
Cashless exercise of warrants	$	3,620			$	-			$	16,305			$	-
Stock issued for noncontingent consideration payments	$	-			$	642,000			$	642,000			$	1,284,000
Warrants issued for debt instruments	$	-			$	-			$	-			$	873,100
Right of use asset	$	1,045,305			$	-			$	2,331,231			$	93,115
Right of use lease liability	$	1,045,305			$	-			$	2,331,231			$	93,115

About the Use of Non-GAAP Financial Measures:
To supplement our financial information presented in accordance with GAAP, we use adjusted EBITDA, cash-adjusted EBITDA and adjusted EPS as non-GAAP financial measures to clarify and enhance an understanding of past performance. Additionally, we report telehealth adjusted EBITDA as a non-GAAP financial measure to clarify the financial performance of our core telehealth business excluding WorkSimpli. We believe that the presentation of these financial measures enhances an investor’s understanding of our financial performance. We further believe that these financial measures are useful financial metrics to assess our operating performance from period-to-period by excluding certain items that we believe are not representative of our core business. We use certain financial measures for business planning purposes and in measuring our performance relative to that of our competitors.

Adjusted EBITDA is defined as income (loss) attributable to common shareholders before interest, taxes, depreciation, amortization, accretion, financing transaction expense, non-controlling interests, foreign currency translation, inventory valuation, sales return reserves, litigation costs, loss on debt extinguishment, dividends, insurance acceptance and Sarbanes-Oxley readiness, acquisition costs, severance expenses and stock-based compensation expense. We have provided below a reconciliation of adjusted EBITDA to net loss attributable to common shareholders, its most directly comparable GAAP financial measure.

Cash adjusted EBITDA is defined as adjusted EBITDA before the change in the Company's deferred revenue balance. We have provided below a reconciliation of cash adjusted EBITDA to adjusted EBITDA.

Adjusted EPS is defined as the diluted net loss attributable to LifeMD, Inc common shareholders before interest, taxes, depreciation, amortization, accretion, financing transaction expense, non-controlling interests, foreign currency translation, inventory valuation, sales return reserves, litigation costs, loss on debt extinguishment, dividends, insurance acceptance and Sarbanes-Oxley readiness, acquisition costs, severance expenses and stock-based compensation expense. We have provided below a reconciliation of adjusted EPS to Diluted loss per share attributable to LifeMD, Inc common shareholders, its most directly comparable GAAP financial measure.

Telehealth adjusted EBITDA is defined as adjusted EBITDA for the telehealth business excluding WorkSimpli. We have provided below a reconciliation of telehealth adjusted EBITDA to net loss attributable to common shareholders solely related to the telehealth business excluding WorkSimpli.

We believe the above financial measures are commonly used by investors to evaluate our performance and that of our competitors. However, our use of the terms adjusted EBITDA and adjusted EPS may vary from that of others in our industry. Adjusted EBITDA, cash adjusted EBITDA, telehealth adjusted EBITDA and adjusted EPS should not be considered as an alternative to net loss before taxes, net loss per share, operating loss or any other performance measures derived in accordance with GAAP as measures of performance.

Reconciliation of GAAP Net Loss to Adjusted EBITDA to Cash Adjusted EBITDA
(in whole numbers, unaudited)
	Three Months Ended June 30,								Six Months Ended June 30,
	2024				2023				2024				2023
Net loss attributable to common shareholders	$	(7,652,202	)		$	(7,509,562	)		$	(15,197,120	)		$	(12,294,581	)
Interest expense (excluding amortization of debt discount)		431,024				525,374				808,258				639,186
Depreciation, amortization and accretion expense		2,288,225				1,603,511				4,401,154				3,038,845
Amortization of debt discount		100,444				115,381				200,888				153,842
Loss on debt extinguishment		-				-				-				325,198
Financing transactions expense		151,143				285,626				323,372				430,077
Litigation costs		495,784				933,126				678,331				1,005,926
Inventory and reserve adjustments		263,513				132,991				566,142				232,630
Severance costs		360,182				-				520,677				-
Acquisitions expenses		-				15,070				-				40,196
Insurance acceptance readiness		263,493				58,540				969,834				58,540
Sarbanes Oxley readiness		23,220				-				183,128				-
Accrued interest on Series B Convertible Preferred Stock		-				354,915				-				467,107
Foreign exchange (gain) loss		504,969				168,098				478,721				523,720
Taxes		3,000				-				3,000				-
Dividends		1,040,793				1,346,197				2,120,173				2,158,760
Stock-based compensation expense		4,191,176				2,861,969				6,735,606				5,525,483
Net income attributable to noncontrolling interests		38,606				841,784				158,038				1,407,767
Adjusted EBITDA	$	2,503,370			$	1,733,020			$	2,950,201			$	3,712,696
Change in Deferred Revenue		1,958,902				(227,335	)			6,333,061				120,704
Cash Adjusted EBITDA	$	4,462,272			$	1,505,685			$	9,283,262			$	3,833,400

Reconciliation of GAAP Diluted Loss per Share Attributable to Common Shareholders to Adjusted EPS
(unaudited)	Three Months Ended June 30,								Six Months Ended June 30,
	2024				2023				2024				2023
Diluted loss per share attributable to LifeMD, Inc. common shareholders	$	(0.19	)		$	(0.23	)		$	(0.38	)		$	(0.38	)
Adjustments to Reconcile GAAP Diluted Loss Per Share to Adjusted EPS
Interest expense (excluding amortization of debt discount)		0.01				0.01				0.02				0.02
Depreciation, amortization and accretion expense		0.06				0.05				0.11				0.09
Amortization of debt discount		-				-				0.01				-
Loss on debt extinguishment		-				-				-				0.02
Financing transactions expense		-				0.01				0.01				0.02
Litigation costs		0.01				0.03				0.02				0.03
Inventory and reserve adjustments		0.01				-				0.01				0.01
Severance costs		0.01				-				0.01				-
Acquisitions expenses		-				-				-				-
Insurance acceptance readiness		0.01				-				0.02				-
Sarbanes Oxley readiness		-				-				-				-
Accrued interest on Series B Convertible Preferred Stock		-				0.01				-				0.01
Foreign exchange (gain) loss		0.01				0.01				0.01				0.02
Taxes		-				-				-				-
Dividends		0.03				0.04				0.05				0.07
Stock-based compensation expense		0.10				0.09				0.17				0.17
Net income attributable to noncontrolling interests		-				0.03				0.01				0.04
Adjusted EPS	$	0.06			$	0.05			$	0.07			$	0.12

Reconciliation of Telehealth GAAP Net Loss to Telehealth Adjusted EBITDA
(in whole numbers, unaudited)
	Three Months Ended June 30,								Six Months Ended June 30,
	2024				2023				2024				2023
Telehealth net loss attributable to common shareholders	$	(7,796,900	)		$	(10,754,681	)		$	(15,789,465	)		$	(17,686,828	)
Interest expense (excluding amortization of debt discount)		430,606				524,171				806,969				636,563
Depreciation, amortization and accretion expense		1,485,696				1,059,963				2,848,770				2,025,643
Amortization of debt discount		100,444				115,381				200,888				153,842
Loss on debt extinguishment		-				-				-				325,198
Financing transactions expense		151,143				285,626				323,372				430,077
Litigation costs		495,784				933,126				678,331				1,005,926
Inventory and reserve adjustments		263,513				132,991				566,142				232,630
Severance costs		360,182				-				520,677				-
Acquisitions expenses		-				15,070				-				40,196
Insurance acceptance readiness		263,493				58,540				969,834				58,540
Sarbanes Oxley readiness		23,220				-				183,128				467,107
Accrued interest on Series B Convertible Preferred Stock		-				354,915				-				-
Foreign exchange (gain) loss		-				-				-				-
Taxes		-				-				-				-
Dividends		812,562				812,562				1,625,125				1,625,125
Stock-based compensation expense		4,191,176				2,861,969				6,735,606				5,525,483
Net income attributable to noncontrolling interests		38,606				841,784				158,038				1,407,767
Telehealth adjusted EBITDA	$	819,525			$	(2,758,583	)		$	(172,586	)		$	(3,752,731	)