“Net Sales” means the gross amount invoiced by Indevus from sales of Product to Third Parties outside the Territory commencing upon the date of first commercial sale outside the Territory after deducting the following:
(a) credits, allowances, recalls, samples, discounts and rebates to, and chargebacks from the account of, Third Party customers or on account of returned or rejected Product, including allowance for breakage or spoilage;
(b) freight, postage, shipping and insurance costs;
(c) trade discounts, cash discounts, quantity discounts, rebates and retroactive price reductions;
(d) sales, value-added, excise and other taxes incurred in connection with the sale of Product and customs duties, custom broker charges and other surcharges and governmental charges incurred in connection with the exportation or importation of Product;
(e) rebates, chargebacks or similar payments or credits granted to managed health care organizations, wholesalers, distributors, buying groups, health care insurance carriers, pharmacy benefit management companies, health maintenance organizations, or other institutions or health care organizations or to any governmental or regulatory authority in respect of any state, provincial, local or federal Medicare, Medicaid or similar programs in any country, their agencies and purchasers and reimbursers; and
(f) bad debt expense.
Sales or other transfers by Indevus, its Affiliates or sublicensees in the Territory shall be excluded from the computation of Net Sales and no payments will be payable on such sales or transfers. Sales or other transfers between Indevus and its Affiliates shall also be excluded from the computation of Net Sales and no payments will be payable on such sales or transfers except where such Affiliates are end users, but Net Sales shall include the subsequent sales by such Affiliates to Third Parties outside the Territory.
“Royalty Term” means ten (10) years commencing from the date of first commercial sale of Product outside the Territory with respect to sales by Indevus.
5. Indevus shall supply sufficient quantities of the Product and matching placebo required for all the Centres participating in the Phase III Clinical Trial for the duration of the Programme at no cost for the supply of Product or placebo or their shipment to the main storage facility, as specified in the Protocol and any written Protocol amendments submitted as amendments to the IND, up to a maximum number of [*] doses of the Product at each strength and [*] doses of matching placebo (unless both parties’ authorised representatives agree in writing that Indevus shall supply an increased number of doses of Product and/or matching placebo).
9. Indevus agrees to take such steps as it considers in good faith to be commercially practicable and reasonable to assist in ensuring that the Product can become available to all communities who have a need for the Product, including developing countries’ markets as well as major commercial markets, subject to the following:
(a) In the case of countries in the Territory, Indevus agrees that:
(i) the Product and/or Indevus’ Intellectual Property Rights will be made available under licence to DFID and/or the MRC or their appointed agents solely for distribution and use of the Product in the Field in any countries in the Territory as set forth in the following sentence and in a separate supply agreement to be negotiated in good faith between Indevus and the MRC. The supply agreement will provide that the Product will be made available to DFID and/or the MRC or their appointed agents free on board at Indevus’ (or its designee’s) manufacturing facility, in exchange for which the MRC or the DFID will pay Indevus an amount equal to Indevus’ total cost of goods sold plus [*] %, and will include other terms relating to such supply, including terms relating to forecasts, orders, delivery and payments, to be mutually agreed to in good faith. […]
(E) Confidentiality, publication of data and intellectual property rights
Access to and publication of data
35. The Trial Data shall be owned or Controlled by the MRC, subject to the license granted to Indevus in the following sentence. The MRC hereby grants to Indevus an exclusive, worldwide license, including the right to grant sublicenses, under the Trial Data, the Know-How and any other Intellectual Property owned or Controlled by the MRC that is developed, made or conceived by or on behalf of the MRC during the course of, in furtherance of, and as a result of activities performed pursuant to the Programme (the “Programme IP”), to develop, make, have made, use, offer for sale, sell, import, and distribute Product for any use. In consideration of the foregoing, Indevus shall pay MRC royalties in an amount equal to [*] of Net Sales by Indevus, its Affiliates or sublicensees outside the Territory in each year during the Royalty Term if the manufacture, use or sale of Product uses or embodies MRC’s Intellectual Property Rights and Indevus’s Intellectual Property Rights, provided however, that in the case of sales by a sublicensee of Indevus, royalties payable by Indevus to MRC in any year during the Royalty Term shall not exceed [*] of all revenues received by Indevus from such sublicensee during that year.
The parties agree and acknowledge that the royalty provided for in this Clause 35 shall incorporate and supercede any royalties that may otherwise be payable by Indevus under any other agreement pursuant to which MRC provided funding for studies of Product, including the Agreement dated as ofOctober 7, 1996 by and between MRC and Procept, Inc. (a predecessor of Paligent, Inc. and that only one payment shall be due with respect to the same unit of Product.
In the event Indevus is required to make royalty payments to one or more third parties in order to make, use or sell Product, Indevus may offset a total of [*] of such third party payments in any royalty period against any royalties that are due MRC in such royalty period, provided that in no event shall the royalty payments to MRC under Paragraph 35 be reduced by more than [*] in any royalty period.
(F) OBLIGATIONS OF THE MRC UNDER THIS AGREEMENT
45. MRC shall arrange, administer and be responsible for all costs associated with the Programme and the Phase III Clinical Trial, except for costs of the supply of Product and placebo as specifically set forth in Clause 5. Except as specifically set forth in this Agreement or unless agreed in writing in advance by authorised representatives of the parties, the MRC will not be responsible for any cost or expense of any kind, incurred for any reason by Indevus in respect of the Programme.