definiens: means the gross amount received by KaloBios or its Affiliates for the sale ofany Licensed Product to any Third Party, less the following deductions ( calculated in accordance withGAAP ) to the extent actually incurred or allowed upon the sale of such Licensed Product:(a ) reasonable and customary trade and quantity discounts ( including pursuant to governmentalregulation or managed care organizations or governmental agencies ) ; ( b ) government - mandatedrebates ; ( c ) allowances for returned or rejected Licensed Product ; ( d ) freight and insurance, ifinvoiced to the purchaser ; ( e ) sales, value - added and other direct taxes on the sale of LicensedProduct ( other than income taxes ) ; and ( f ) the portion of any management fees paid during therelevant time period to group purchasing organizations that relate specifically to the sale of suchLicensed Product to such organizations . For clarity, any Licensed Products used ( but not sold forconsideration ) for promotional or advertising purposes, or used for clinical or other research purposes, shall not be considered in determining Net Sales under this Agreement