definiens: . Cost of Goods Sold means, with respect to API Bulk Drug Substance, Finished Product or placebo, as the case may be, Manufactured under this Agreement, the reasonable internal and external costs of a Party or any of its Related Parties incurred in Manufacturing such API Bulk Drug Substance, Finished Product or placebo, including : ( a ) to the extent that such API Bulk Drug Substance, Finished Product or placebo is Manufactured by a Party or any of its Related Parties, the Cost of Goods Sold of such API Bulk Drug Substance, Finished Product or placebo, consisting of direct material and direct labor costs, [ plus Manufacturing overhead attributable to such API Bulk Drug Substance, Finished Product or placebo ( including facilities ' start - up costs, all directly incurred Manufacturing variances, and a reasonable allocation of related Manufacturing administrative and facilities costs ( including depreciation ) and a reasonable allocation of the costs of failed batches to be further described in -5-'Confidential Treatment Requested . Omitted portions filed separately with the Commission