the
Commission.
6
COLLABORATION IP, AND ANY THIRD PARTY TECHNOLOGY THAT IS INCLUDED IN THE
DEFINITION OF CUBIST TECHNOLOGY AFTER THE EFFECTIVE DATE IN ACCORDANCE WITH
SECTION 8.6.
SECTION 1.33
"DEVELOPMENT" OR "DEVELOP".
DEVELOPMENT OR DEVELOP MEANS
NON-CLINICAL AND CLINICAL RESEARCH AND DRUG DEVELOPMENT ACTIVITIES, INCLUDING
RESEARCH ACTIVITIES DIRECTED AT BACK-UP COMPOUNDS, TOXICOLOGY, PHARMACOLOGY AND
OTHER DISCOVERY EFFORTS, TEST METHOD DEVELOPMENT AND STABILITY TESTING, PROCESS
DEVELOPMENT, FORMULATION DEVELOPMENT, DELIVERY SYSTEM DEVELOPMENT, QUALITY
ASSURANCE AND QUALITY CONTROL DEVELOPMENT, STATISTICAL ANALYSIS, CLINICAL
STUDIES (INCLUDING PRE- AND POST-APPROVAL STUDIES AND INVESTIGATOR SPONSORED
CLINICAL STUDIES), REGULATORY AFFAIRS, AND REGULATORY APPROVAL AND CLINICAL
STUDY REGULATORY ACTIVITIES (EXCLUDING REGULATORY ACTIVITIES DIRECTED TO
OBTAINING PRICING AND REIMBURSEMENT APPROVALS).
SECTION 1.34
"DEVELOPMENT COSTS".
DEVELOPMENT COSTS MEANS COSTS INCURRED BY
THE PARTIES OR ANY OF THEIR AFFILIATES IN DEVELOPING LICENSED PRODUCT IN THE
FIELD FOR THE PROFIT-SHARE TERRITORY, IN ACCORDANCE WITH THIS AGREEMENT AND
DETERMINED FROM THE BOOKS AND RECORDS OF THE APPLICABLE PARTY AND ITS AFFILIATES
MAINTAINED IN ACCORDANCE WITH GAAP, CONSISTENTLY APPLIED, WHETHER INCURRED
BEFORE OR AFTER REGULATORY APPROVAL, PROVIDED SUCH ACTIVITIES AND COSTS ARE
CONSISTENT WITH THE DEVELOPMENT PLAN AND RELATED BUDGET, INCLUDING:
(A)
ALL OUT-OF-POCKET COSTS AND EXPENSES INCURRED;
(B)
THE COSTS OF INTERNAL SCIENTIFIC, MEDICAL OR TECHNICAL PERSONNEL
ENGAGED IN SUCH EFFORTS, WHICH COSTS SHALL BE DETERMINED BASED ON THE FTE COST,
UNLESS ANOTHER BASIS IS OTHERWISE AGREED BY THE PARTIES IN WRITING;
(C)
THE COSTS AND EXPENSES FOR PRE-CLINICAL AND CLINICAL SUPPLIES
NEEDED FOR SUCH EFFORTS AS SET FORTH IN THE DEVELOPMENT PLAN, CONSISTING OF
(I) []* FOR CLINICAL SUPPLIES OF LICENSED PRODUCT AND PLACEBO; (II) COST OF
COMPARATOR OR COMBINATION DRUGS OR DEVICES; AND (III) COSTS AND EXPENSES OF
DISPOSAL OF CLINICAL SAMPLES;
(D)
FEES INCURRED IN CONNECTION WITH FILINGS FOR OR RELATING TO
REGULATORY APPROVALS OR PRICING OR REIMBURSEMENT APPROVAL IN THE FIELD IN THE
PROFIT-SHARE TERRITORY;
(E)
COSTS AND EXPENSES INCURRED IN CONNECTION WITH (I) []*; AND
(V) INTERNAL AND THIRD PARTY COSTS AND EXPENSES INCURRED IN CONNECTION WITH
(A) []*; AND
(F)
ANY OTHER COSTS INCURRED THAT ARE EXPLICITLY INCLUDED IN THE
BUDGETS INCLUDED IN THE DEVELOPMENT PLAN.
For purposes of clarity, it is understood that costs and expenses included in
the calculation of N.A. Pre-Tax Profit or Loss, and the deductions specified in
the definition of Net Sales or in Development Costs, shall not be
double-counted.
*Confidential Treatment Requested.
Omitted portions filed separately with the
Commission.
7
SECTION 1.35
"DEVELOPMENT PLAN".
DEVELOPMENT PLAN MEANS THE WRITTEN WORKPLAN,
TIMETABLE AND BUDGET FOR THE PARTIES' LICENSED PRODUCT DEVELOPMENT EFFORTS IN
THE PROFIT-SHARE TERRITORY, AGREED UPON BY THE PARTIES AS OF THE EFFECTIVE DATE,
AS AMENDED FROM TIME TO TIME IN ACCORDANCE WITH THIS AGREEMENT.
THE INITIAL
DEVELOPMENT PLAN IS ATTACHED AS EXHIBIT E.
SECTION 1.36
"DILIGENT EFFORTS".
DILIGENT EFFORTS MEANS, WITH RESPECT TO EACH
PARTY'S OBLIGATIONS RELATING TO LICENSED PRODUCT, THE CARRYING OUT OF SUCH
OBLIGATIONS IN A DILIGENT AND SUSTAINED MANNER USING EFFORTS SUBSTANTIALLY
SIMILAR TO THE EFFORTS A BIOPHARMACEUTICAL COMPANY OF COMPARABLE SIZE AND
RESOURCES