THE
PARTIES IN THE ACTIVITIES GOVERNED BY THIS AGREEMENT, INCLUDING SUCH ACTIVITIES
RELATING TO THE DEVELOPMENT AND REGULATORY APPROVAL OF LICENSED PRODUCT.
SECTION 1.21
"COMMERCIALIZATION" OR "COMMERCIALIZE".
COMMERCIALIZATION OR
COMMERCIALIZE MEANS (A) PRE-LAUNCH, LAUNCH OR POST LAUNCH ACTIVITIES DIRECTED TO
OBTAINING PRICING AND REIMBURSEMENT APPROVALS, MARKETING, PROMOTING,
DISTRIBUTING, IMPORTING OR SELLING A PRODUCT, AND (B) SOLELY FOR DEFINITIONAL
PURPOSES IN IMPLEMENTING THE TERMS OF THIS AGREEMENT, ALL POST-APPROVAL MEDICAL
AND REGULATORY ACTIVITIES.
COMMERCIALIZATION INCLUDES STRATEGIC MARKETING,
MARKET RESEARCH, SALES FORCE RECRUITMENT, TRAINING AND MEETINGS, SALES FORCE
DETAILING, SAMPLE DROPS, ACTIVITIES RELATED TO MANAGED CARE ACCOUNTS AND OTHER
SIMILAR ACCOUNTS AND GOVERNMENT PROGRAMS, ACTIVITIES RELATED TO REIMBURSEMENT,
ADVERTISING, MARKET AND PRODUCT SUPPORT, CUSTOMER SUPPORT, EDUCATIONAL
INITIATIVES, PRODUCT DISTRIBUTION, INVOICING, AND SALES ACTIVITIES.
COMMERCIALIZATION SHALL NOT INCLUDE ANY ACTIVITIES RELATED TO MANUFACTURING.
SECTION 1.22
"COMMERCIALIZATION COSTS".
COMMERCIALIZATION COSTS MEANS, WITH
RESPECT TO LICENSED PRODUCT IN THE FIELD IN THE PROFIT-SHARE TERRITORY, WHETHER
OR NOT OCCURRING DURING DEVELOPMENT OR COMMERCIALIZATION (A) THE COSTS AND
EXPENSES INCURRED BY A PARTY OR ANY OF ITS RELATED PARTIES IN THE
COMMERCIALIZATION OF LICENSED PRODUCT, INCLUDING THE COSTS OF ADVERTISING,
DETAILING, SALES, MARKETING AND PROMOTION OF LICENSED PRODUCT AND MEDICAL,
CUSTOMER OR REGULATORY SUPPORT AND A REASONABLE ALLOCATION (SUBJECT TO THE
OVERSIGHT OF THE JCT) OF []* FOR SALES FORCE MANAGEMENT AND SUPPORT,
(B) INFRASTRUCTURE REQUIRED TO SUPPORT AND MAINTAIN PATIENT/SAFETY SURVEILLANCE
AS REQUIRED BY APPLICABLE REGULATORY AUTHORITIES DIRECTLY ATTRIBUTABLE TO
LICENSED PRODUCT, INCLUDING THE COSTS OF MAINTAINING THE GLOBAL SAFETY DATABASE
CONTEMPLATED UNDER SECTION 5.9, (C) REASONABLE OUT-OF-POCKET []* COSTS AND
EXPENSES INCURRED BY A PARTY OR ANY OF ITS RELATED PARTIES WITH RESPECT TO []*,
(D) REASONABLE OUT-OF-POCKET []* INCURRED BY A PARTY OR ANY OF ITS RELATED
PARTIES REGARDING []* UNDER SECTION 8.4 TO THE EXTENT SUCH ENFORCEMENT ACTION IS
APPROVED BY THE JSC AND REASONABLE OUT-OF-POCKET COSTS AND EXPENSES INCURRED BY
A PARTY OR ANY OF ITS RELATED PARTIES AND INCLUDED IN COMMERCIALIZATION COSTS
PURSUANT TO SECTION []*, IN EACH CASE WITH RESPECT TO []* IN THE FIELD IN THE
PROFIT-SHARE TERRITORY, (E) THE REASONABLE OUT-OF-POCKET COSTS AND EXPENSES OF
MAINTAINING REGULATORY APPROVAL FOR LICENSED PRODUCT, (F) EXCEPT FOR THOSE
OBLIGATIONS TO BE PAID FULLY BY ALNYLAM UNDER SECTION 7.7, []* TO THE EXTENT
REASONABLY ALLOCABLE TO THE PROFIT-SHARE TERRITORY, (G) THE COSTS OF PRODUCT
RECALLS, WITHDRAWALS, INSURANCE, []* AND RETURNED PRODUCT DESTRUCTION, AND
(H) THE COST OF []*.
IN CALCULATED COMMERCIALIZATION COSTS, THE COSTS OF
INTERNAL PERSONNEL ENGAGED IN COMMERCIALIZATION EFFORTS SHALL BE BASED ON THE
FTE COST APPLICABLE TO SUCH EFFORTS, UNLESS ANOTHER BASIS IS OTHERWISE AGREED BY
THE PARTIES IN
*Confidential Treatment Requested.
Omitted portions filed separately with the
Commission.
4
WRITING.
FOR SAKE OF CLARITY, THE FTE COST OF A SALES REPRESENTATIVE DOES NOT
INCLUDE []* BASED ON SALES OF LICENSED PRODUCT IN THE PROFIT-SHARE TERRITORY,
WHICH SUCH []* SHALL BE SEPARATELY INCLUDED AS A COMMERCIALIZATION COSTS BUDGET
ITEM.
FOR PURPOSES OF CLARITY, COSTS AND EXPENSES INCLUDED IN THE CALCULATION
OF N.A. PRE-TAX PROFIT OR LOSS, AND