definiens: . Fully Allocated Supply Cost shall mean with respect to API Bulk Drug Substance and/or Finished Product, as the case may be, the manufacturing Party 's internal and external costs, determined in accordance with GAAP, as consistently applied by such manufacturing Party in the ordinary course of its business, incurred in Manufacturing and/or acquiring such API Bulk Drug Substance and/or Finished Product ( including but not limited to the following activities during the Term : process development and validation, manufacturing scale - up and improvements, stability and other product testing and development activities relating to quality assurance and quality control, regulatory affairs activities and product liability insurance ), which costs shall include, without limitation ( a ) the cost of goods produced, which cost shall include direct labor, material and Third Party expenses as well as Allocable Overhead ( defined below ), but shall not include any intellectual property acquisition or licensing costs or royalties directly allocable to the Manufacture, use or sale of such API Bulk Drug Substance and/or Finished Product and/or ( b ) any other costs borne by the manufacturing Party for the packaging, transport, customs clearance and storage of such API Bulk Drug Substance and/or Finished Product directly allocable to the manufacture of such API Bulk Drug Substance and/or Finished Product ( e.g., containers, freight, duties, insurance and warehousing ) . For purposes of this definition, shall mean costs incurred by the manufacturing Party or for its account that are attributable to supervisory and technical operations services, occupancy costs, and payroll, information systems, human relations or purchasing functions and which are allocated to company departments based on space occupied or headcount or other activity - based method . Allocable Overhead shall not include any cost attributable to general corporate activities, including, by way of example, executive management, investor relations, business development, legal affairs and finance, and none of such costs will be included as part of Fully Allocated Supply Cost in any event . In the event either Party is not Manufacturing API Bulk Drug Substance or Finished Product, as the case may be, but a Related Party of such Party is exercising such Party 's rights and obligations under Article VI hereof, or an Other Related [COMPANY] Licensee is responsible for [COMPANY] ' obligations under Article VI hereof, to Manufacture and supply API Bulk Drug Substance or Finished Product, as the case may be, then any reference in this definition to such Party as a manufacturing Party with respect to API Bulk Drug Substance or Finished Product, as the case may be, shall be deemed to be a reference to such Related Party or such Other Related [COMPANY] Licensee, as the case may be