definiens: means the actual and direct costs and expenses in curred by a Party and its Affiliates or for its account, as calculated in acc ordance with IFRS or GAAP, whichever such Party use s throughout its organization at the time in question, consistently applied, that are specifically ident ifiable or reasonably and consistently allocable to the Develo pment of Licensed Products and that are directed to achieving or maintaining Regulatory Approval of the Licensed Products . The Development Costs shall include amoun ts, without mark - up, that a Party pays to Third Parties involved in such Development work, and all interna l costs incurred by a Party in connection with such Develop ment work . Development Costs include the following : ( a ) all pre - clinical costs, such as costs for toxic ology, pharmacokinetics / metabolism and pharmacologi cal studies, that are incurred after the selection of a Selected Licensed Product pursuant to Section 3.5 ( c ) ; ( b ) costs of formulation development, process development, te st method development, delivery system development, and stability testing ; ( c ) costs of Phase 1 Clinical Tr ials, Phase 2 Clinical Trials and Phase 3 Clinical Trials of the Licensed Products, including ethics committee fees, investigators fees, investigators meeting costs, f ees for clinical research organization ’s services ( limited to the following activities : monitoring, central an d core laboratory services ( including bioanalysis ), medica l writing, data management, statistics analysis, PK and PK / PD analysis ) ; ( d ) Cost of Goods of Licensed Oligos and Licensed Products for use in Development activitie s, including the manufacture, purchase and/or packagin g of comparators or placebo for use in clinical stu dies of the Licensed Products, as well as the direct costs and expenses of transportation, storage, disposal of dr ugs and other supplies used in such clinical studies and inventor y write - offs and capacity reservation charges there for ; ( e ) costs of manufacturing process development for a Licensed Oligo or Licensed Product, including CMC, scale up, validation, improvement, qualification and validati on of the manufacturing site and manufacturer ; ( f ) regulatory expense relating to Development activities for the purpose of obtaining Regulatory Approval for the Li censed Products ( but excluding the filing fees for MAAs ) ; ( g ) the costs of Developing a Companion Diagnostic after the selection of the relevant Selected Biomarker(s ) ; an d ( h ) other costs and expenses that meet the criter ia set forth above . Development Costs shall specifically exclude general corporate and administrative overhead of e ach Party . In calculating the Development Costs, each P arty ’s FTE efforts shall be calculated at the FTE R ate