definiens: shall mean, for any period, the gross amount invoiced by [COMPANY], its Sublicensees or any of itsor their respective Affiliates for the sale or transfer of Licensed Products ( the ), less deductions for : ( a ) normaland customary trade, quantity and cash discounts, credits, and sales returns and allowances, including ( i ) those granted onaccount of price adjustments, billing errors, rejected goods, damaged goods and returns, ( ii ) administrative and other fees andreimbursements and similar payments actually made to wholesalers and other distributors, buying groups, pharmacy benefitmanagement organizations, health care insurance carriers and other customers or institutions in connection with the sale ofLicensed Products, ( iii ) allowances, rebates and fees incurred on the sale of Licensed Product, and ( iv ) chargebacks ; ( b ) freight, postage, shipping and insurance expenses to the extent that such items are incurred on the sale of Licensed Product;(c ) customs and excise duties and other duties related to the sales to the extent that such items are incurred on the sale ofLicensed Product ; ( d ) rebates and similar adjustments made with respect to sales paid for by any governmental or regulatoryauthority ; ( e ) sales and other taxes and duties directly related to the sale or delivery of Licensed Product(s ) ( but not includingtaxes assessed against the income derived from such sale ) ; ( f ) any other similar and customary deductions that aresubstantially similar to any of the foregoing ; and ( g ) any such invoiced amounts that are not collected by [COMPANY], itsSublicensees or any of its or their respective Affiliates ; provided that such uncollected amount shall not exceed two percent(2 % ) of the invoiced amounts, less deductions under clauses ( a ) through ( f ) above . Deductions pursuant to clause ( g ) aboveshall be taken in the Calendar Quarter in which the bad debt was recorded . For purposes of determining Net Sales, a LicensedProduct shall be deemed to be sold when invoiced and a shall not include transfers or dispositions of such LicensedProduct for use in any pre - clinical experiment, research or in any Clinical Trial or as samples, in each case, without charge orfor a de minimis charge . [COMPANY] ’s, any of its Sublicensee ’s or its or their respective Affiliate ’s transfer of LicensedProduct to an Affiliate or Sublicensee shall not result in any Net Sales, unless such Licensed Product is used by such Affiliateor Sublicensee in the course of its commercial activities