definiens: DevelopmentDevelop " . Development or Develop means non­clinical and clinical research and drug development activities, including toxicology, phaml8cology and other discovery efforts, test method development and stability testing, process development, fonnulation development, delivery system development, quality assurance and quality control development, statistical analysis, preclinical studies, animal studies, Clinical Trials and other clinical studies ( including pre - and p(lst ~ approval studies and investigator sponsored clinical studies ), regulatory affairs, and Regulatory Approval and clinical study regulatory activities ( excluding regulatory activities directed prinCipally to obtaining pricing and rcimhurscmellt approvals ), Seclion 1.16 . Developmenl Costs means the costs and expenses incurred by or on behalf of a Party attributable to, or reasonably allocable tOj the Development of the Licensed Compound or the Licensed Product and that are materially consistent ! as applicable, with the Development Plan ( including the budget for Development activities included in the Development Plan ) . Except to the extent such costs are built into the FTE Rate, Development Costs shall not include costs and expenses that are allocable to or in respect of management, 3 ACIIVEU~ 719j.j < J72vl CONFIDENTIAL EXECUTION COPY fimmcial, legal or business development personneL, to the extent covered by the Development Plan, shall include : ( a ) the costs ofChnical Trials ( including all costs of insurance ), the preparation, collation and validation of data from such Clinical Trials and the preparation of medical writing and publishing ; ( b ) the FTE costs of the relevant Party or its Affiliates with respect to any of the matters specitied in clause ( a ) ; ( c ) all Out - of - Pocket Costs incurred by the Parties or their Affiliates, including pr - tyments made to Third Parties with respect to any of1he matters specified in clause ( a ) ( except to the extent that such costs have been included in FTE costs ) ; ( d ) Regulatory Expenses ; ( e ) the cost of contract research organizations ( CROs ) ; and ( t ) the Manufacturing Costs of clinical supplies, Section 1.17, Development Plan means the plan for the Development of the Licensed Compound and the Licensed Product in the MERRIMACK Territory and the PEl Territory ( other than Development activities conducted by PET pursuant to Section 4.2(b)(iii ) ) attached to this Agreement as Exhibit D, as prepared, updated and amended trom time to time in accordance with Section 3.1 ( b ), Section 3.2(b ), Section 4.1 ( b ), Section 4.2(b ) and Section 4.2(c )