definiens: means the actual gross amount invoiced by [COMPANY], its Affiliates or its sublicensees for the commercial sale of Product in the [COMPANY] Territ ory to a Third Party, commencing upon the date of First Commercial Sale, after deducting, in accor dance with GAAP, the following : ( a ) trade, cash, quantity or ordinary discounts ; ( b ) allowances for product returns, including allow ances or credits for rejected Product, or spoilage or recalled Product ; ( c ) rebates and charge backs ; ( d ) sales or excise taxes, VAT or other taxes, and transportation and insurance charges and additional special transportation, custom dutie s, and other governmental charges ; ( e ) rebates or similar payments paid in connection with sales of Product to any governmental or regulatory authority in respect of any state or federal programs similar to Medicare or Medicaid in the United States in any co untry of the [COMPANY] Territory ; and ( f ) retroactive price reductions and write - offs or allowances for bad debt, not to exceed two percent ( 2 % ) of Net Sales