definiens: means the gross amount invoiced for all Product sold by the Purchaser and its Affiliates and sublicensees inarm’s - length transactions to Third Parties in the Territory, in each case after subtracting ( i ) normal and customary trade, quantity and cash discounts, rebates and chargebacks in arm’s - length transactions allowed or given to wholesalers andother distributors ( including retailers ) buying groups or other 6institutions ; ( ii ) duties and taxes ( other than income taxes ) incurred by the Purchaser with respect to shipment of theProduct from the Purchaser ’s distribution facilities, but excluding freight, shipping and insurance costs ; ( iii ) fees, reimbursements or similar payments or adjustments granted or paid to wholesalers or other distributors, buying groups, healthcare insurance carriers or other persons ; ( iv ) credits or allowances actually granted for damaged goods, recalls, returns or rejections ( including, but not limited to, wholesaler, distributor and retailer returns ) of Product or forretroactive price reductions ; ( v ) any payment, allowance or credit to any Governmental Entity, including United Statesfederal or state Medicaid, Medicare or similar programs ; and ( vi ) actual bad debt write - off attributable to the sale of theProduct . For clarity, any of the items set forth above that would otherwise be deducted from the invoice price in thecalculation of Net Sales but which are separately charged to, and paid by, Third Parties shall not be deducted from theinvoice price in the calculation of Net Sales . Net Sales shall be determined on an accrual basis ( except for clause(vi ) above ) in accordance with United States Generally Accepted Accounting Principles, applied on a basis consistentwith the Purchaser ’s annual audited financial statements