Cellectar Biosciences, Inc. 10-Q

Item 1A. Risk Factors Other factors that could materially adversely affect our business and our equity securities are described in the Risk Factors previously disclosed in Form 10-K, our Annual Report filed with the SEC on March 2, 2021 pursuant to Section 13 or 15(d) of the Exchange Act (the “2020 10-K”). This information should be considered carefully, together with other information in this report and other reports and materials we file with the SEC. In addition, the following risk factor included substantive changes from those disclosed in the 2020 10-K: If we are unable to adequately protect or enforce our rights to intellectual property or to secure rights to third-party patents, we may lose valuable rights, experience reduced market share, assuming any, or incur costly litigation to protect our intellectual property rights. Our ability to obtain licenses to patents, maintain trade-secret protection, and operate without infringing the proprietary rights of others will be important to commercializing any products under development. Therefore, any disruption in access to the technology could substantially delay the development of our technology. We require our employees and consultants to execute appropriate confidentiality and assignment-of-inventions agreements. However, such employees and consultants may not always comply with these agreements and enforcing them can be expensive and uncertain. For example, on October 15, 2021, we filed a lawsuit against Dr. Jamey Weichert, a former director and executive officer of the Company and Dr. Anatoly Pinchuk, a former employee and consultant of the Company, alleging breach of their contractual and fiduciary duties by diverting intellectual property that rightfully belongs to the Company. If our employees and consultants fail to comply with their obligations, we may be unable to meaningfully protect our rights in our patentable technology. The patent positions of biotechnology and pharmaceutical companies, such as ours, for products that involve licensing agreements are frequently uncertain and involve complex legal and factual questions. In addition, the coverage claimed in a patent application can be significantly reduced before the patent is issued or in subsequent legal proceedings. Consequently, our patent applications and any issued and licensed patents may not provide protection against competitive technologies or may be held invalid if challenged or circumvented. To the extent we license patents from third parties, the early termination of any such license agreement would result in the loss of our rights to use the covered patents, which could severely delay, inhibit or eliminate our ability to develop and commercialize compounds based on the licensed patents. Our competitors may also independently develop products similar to ours or 26 Table of Contents design around or otherwise circumvent patents issued or licensed to us. In addition, the laws of some foreign countries may not protect our proprietary rights to the same extent as U.S. law. We also rely on trade secrets, technical know-how and continuing technological innovation to develop and maintain our competitive position. Although we generally require our employees, consultants, advisors and collaborators to execute appropriate confidentiality and assignment-of-inventions agreements, our competitors may independently develop substantially equivalent proprietary information and techniques, reverse engineer our information and techniques, or otherwise gain access to our proprietary technology. We may be unable to meaningfully protect our rights in trade secrets, technical know-how and other nonpatented technology. Enacted and future legislation may increase the difficulty and cost for us to commercialize our product candidates and may affect the prices we may set. In the United States, particularly over the past few years, a number of legislative and regulatory proposals have been introduced in an attempt to lower drug prices. These include proposals that would allow the U.S. government to negotiate prices for drugs covered under Medicare and to limit drug reimbursement in Medicare and/or the commercial market based on reference prices. For example, in late 2019, a drug-pricing bill, H.R. 3, passed the House of Representatives, which would, among other things, enable direct price negotiations by the federal government on certain drugs (with the maximum price paid by Medicare capped by prices derived from an international index), includes a penalty for failing to reach agreement with the government and requires that manufacturers offer these negotiated prices to other payers. On November 2, 2021, Congress announced a framework for drug pricing reform that includes inflation penalties, Medicare negotiation for select drugs paid for under Parts B and D, and a Medicare Part D redesign. As of the date of this filing, this framework remains in discussion with policymakers in Congress and the Administration. We expect that additional U.S. federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that the U.S. federal government will pay for healthcare products and services, which could result in reduced demand for our product candidates or additional pricing pressures. ​ Item 6. Exhibits ​ Incorporation by Reference Exhibit No. Description Filed with this Form 10-Q Form Filing Date Exhibit No. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 31.1* Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 X 31.2* Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 X 32.1* Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 X 101 Interactive Data Files X 104 ​ Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit). ​ X ​ ​ ​ ​ ​ ​ * Filed herewith. ​ 27 Table of Contents SIGNATURES ​ Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. ​ CELLECTAR BIOSCIENCES, INC. Date: November 8, 2021 By: /s/ James V. Caruso James V. Caruso President and Chief Executive Officer ​ ​ 28