definiens: means the cost incurred by HGS or any of its Affiliates and includesthe fully allocated cost of manufacturing any Compound or Product, as such costs are specifically allocatedto such Compound or Product and as computed in accordance with GAAP and HGS ’ internal standardsapplied consistently among its products, consisting of : ( a ) Materials cost, which means the price paid for raw material, intermediates, componentsand finished goods which are purchased from outside vendors as well as any freight and duty whereapplicable ; ( b ) Direct labor costs, which means the allocable employment cost of all personneldirectly engaged in the Manufacture of the Compound or Product within the relevant manufacturingoperating unit, to the extent allocated to the actual Manufacture of the Compound or Product ; ( c ) Direct costs and allocated factory overhead costs, which means the cost of specificactivities that are provided by support functions either on or off - site, provided they are directly related to theManufacture ( including fill and finish activities ) or packaging of Compound or Product and not a generaloverhead allocation or charge . Overhead costs consists of expenses associated with quality assurancetesting, quality compliance, stability testing, batch review, equipment maintenance costs, manufacturingutilities, waste removal, storage, transportation, insurance for the factory, its contents or other directly relateditems, factory management and factory administrative expenses, factory changeover or preventative * * * INDICATES MATERIAL THAT WAS OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT WASREQUESTED . ALL SUCH OMITTED MATERIAL WAS FILED SEPARATELY WITH THE SECURITIES ANDEXCHANGE COMMISSION PURSUANT TO RULE 406 PROMULGATED UNDER THE SECURITIES ACT OF 1933,AS AMENDED