Common use of Development Costs Clause in Contracts

Development Costs. (a) Subject to Sections 5.11(c) and 5.12, Development Costs shall be borne [*]. (b) In accordance with procedures to be established by the JDC, each Party shall calculate and maintain records of Development Costs incurred by it. Within sixty (60) days after the end of each six-month period (ending June 30 and December 31) during which the Parties are co-developing at least one Co-Developed Product, each Party shall send the other Party a report which specifies the Development Costs incurred by such Party during such six-month period with respect to each Co-Developed Product in the Co-Developed Territory. The Parties shall seek to resolve any questions related to such accounting statements within ninety (90) days following receipt. (c) If the reports for a particular six-month period show that one Party’s Development Costs for such six-month period were greater than [*], then the other Party (the “Reimbursing Party”) shall pay the first Party, within ninety (90) days after the end of such six-month period, an amount equal to [*], provided that the total Development Costs for each Co-Developed Product for such six-month period did not exceed [*] for such product for such six-month period. (i) If the total Development Costs exceed such [*] by more than [*] for such six-month period and the Reimbursing Party’s Development Costs for such six-month period for such product were less than [*], then the Reimbursing Party shall first pay the other Party an amount equal to the difference between (A) the Development Costs incurred by the Reimbursing Party for such product in such six-month period and (B) [*]. (ii) The Reimbursing Party’s obligation to reimburse the other Party for [*] of all such Development Costs in excess of [*] shall be limited to (A) those additional Development Costs approved by the JDC (either before or after they are incurred) and (B) those additional Development Costs that are the result of work carried out in response to a governmental requirement (imposed or directed following preparation of such Development Budget) to do such work. If, after any payment by the Reimbursing Party pursuant to Section 5.11(c)(i), the Reimbursing Party’s total Development Cost expenditures, including such payment, (collectively “Z”) are less than [*] where X is [*] and Y is 100% of such reimbursable additional Development Costs, then the Reimbursing Party shall pay the other Party an amount equal to [*]. Failure of a Party to reimburse the other Party for any Development Costs that are subject to a good faith dispute hereunder shall not be deemed to be a material breach of this Agreement.

Development Costs. (a) Subject Except as set forth in the Co-Promotion Agreement, commencing with the Fiscal Quarter beginning January 1, 2009, and occurring each Fiscal Quarter thereafter, the Parties agree to Sections 5.11(c) and 5.12, pay the Development Costs for the development and Regulatory Approval of the Licensed Product in the Field of Use as follows: Allergan shall be borne [*]. responsible for sixty-five percent (b65%) In accordance with procedures to be established by the JDC, each Party shall calculate and maintain records of Development Costs incurred by itSpectrum and Allergan in performing their obligations hereunder, and Spectrum is responsible for thirty-five percent (35%) of the Development Costs incurred by Spectrum and Allergan in performing their obligations hereunder. Within sixty the first five (605) business days of each Fiscal Quarter commencing on January 1, 2009, Allergan shall pay Spectrum quarterly in advance Allergan’s share of the estimated Development Costs which Spectrum is estimated to incur for such Fiscal Quarter (as set forth in the JDP). On a monthly basis the Parties agree to discuss the Development Costs incurred in the previous month and review tracking of actual Development Costs to estimated Development Costs. The Parties shall reconcile their respective applicable Development Costs, and will deliver to the other Party, by the third business day after the new Fiscal Quarter, the backup requested by such other Party to complete such other Party’s quarterly accounting close. The estimate provided by each Party on the third business day shall be materially correct as regards actual Development Costs incurred. Within thirty (30) days after the end of each sixFiscal Quarter, Allergan will provide Spectrum with an invoice representing thirty-month period five percent (ending June 30 and December 3135%) during which the Parties are co-developing at least one Co-Developed Product, each Party shall send the other Party a report which specifies of the Development Costs incurred by such Party Allegan during such six-month period with respect the previous Fiscal Quarter and Spectrum will process a payment to each Co-Developed Product in the Co-Developed Territory. The Parties shall seek to resolve any questions related to such accounting statements Allergan within ninety thirty (9030) days following receipt. receipt of this invoice. Within thirty (c) If the reports for a particular six-month period show that one Party’s Development Costs for such six-month period were greater than [*], then the other Party (the “Reimbursing Party”) shall pay the first Party, within ninety (9030) days after the end of such sixeach Fiscal Quarter, Spectrum shall perform a true-month periodup to determine its actual Development Costs incurred during the previous Fiscal Quarter. If the true-up reflects actual Development Costs incurred in excess of advances previously made by Allergan, Spectrum will provide Allergan with an invoice representing the excess and Allergan will process a payment to Spectrum within thirty (30) days following receipt of this invoice. If the true-up reflects actual Development Costs incurred less than advances previously made by Allergan, Spectrum will reduce their next quarterly advance from Allergan by the amount equal to [*], provided that of the total shortfall. Spectrum shall bear all Development Costs for each Co-Developed development of the Licensed Product incurred prior to January 1, 2009. In the event of a Development Trigger after which Allergan delivers notice to Spectrum under Section 10.1 for such six-month period did not exceed [*] for such product for such six-month period. (i) If the total Development Costs exceed such [*] by more than [*] for such six-month period and the Reimbursing Party’s Development Costs for such six-month period for such product were less than [*]Allergan to take over development, then the Reimbursing Party shall first pay the other Party an amount equal to the difference between (A) all of the Development Costs incurred by Allergan in performing the Reimbursing Party for such product in such six-month period development and (B) [*]. (ii) The Reimbursing Party’s obligation to reimburse the other Party for [*] of all such Development Costs in excess of [*] Regulatory Approval services itself shall also be limited to (A) those additional Development Costs approved borne by the JDC (either before or after they are incurredParties in the ratio(s) and (B) those additional Development Costs that are the result of work carried out set forth in response to a governmental requirement (imposed or directed following preparation of such Development Budget) to do such work. If, after any payment by the Reimbursing Party pursuant to this Section 5.11(c)(i), the Reimbursing Party’s total Development Cost expenditures, including such payment, (collectively “Z”) are less than [*] where X is [*] and Y is 100% of such reimbursable additional Development Costs, then the Reimbursing Party shall pay the other Party an amount equal to [*]. Failure of a Party to reimburse the other Party for any Development Costs that are subject to a good faith dispute hereunder shall not be deemed to be a material breach of this Agreement6.6.

Development Costs. (a) Subject to Sections 5.11(c) and 5.12, The parties shall share Development Costs as follows: (i) From the Effective Date, Roche shall be borne [responsible for payment of eighty percent (80%) of the Development Costs * and Agouron shall be responsible for payment of twenty percent (20%) of such Development Costs; provided, however, that Roche shall not be responsible for Development Costs incurred for services performed before June 19, 1996, even if such services are paid for after such date. If Agouron has elected to Co-Promote a Product arising out of the Development Program for cancer indications in one or more European Co-Promotion Countries, *]. (ii) Development Costs incurred for services * In addition to its twenty percent (20%) share of worldwide Development Costs because of its Co-Promotional activities in the North American Territory, * (iii) Agouron's prorata percentage share of Development Costs for such European Co-Promotion Country * (iv) Development Costs allocated to a European Co-Promotion Country shall * Unless the parties agree otherwise, * shall be deemed to have been incurred for the benefit of * (b) In accordance with procedures to be established by the JDC, each Party shall calculate and maintain records of Development Costs incurred by it. Within sixty (60) * days after the end of each sixa semi-month annual calendar period (ending on either June 30 and or December 31) 31 during which the Parties are co-developing at least one Co-Developed Productparties have incurred Development Costs, each Party party shall send prepare and deliver to the other Party party a report which specifies the full and true accounting of such party's actual Development Costs incurred by for such Party during such sixsemi-month period with respect to each Co-Developed Product in the Co-Developed Territoryannual period. The Parties form of the report shall seek be consistent with the format presented in Schedule 1 to resolve Attachment 1, and shall detail actual Development Costs by major cost categories, consistent with the accounting classifications and methods agreed upon by the parties. The accuracy of the report shall be reviewed and signed by an appropriate financial employee of the reporting party. The calculation of Development Costs shall not include any questions related to such accounting statements within ninety (90) days following receiptselling or marketing costs and expenses. (c) If the reports for a particular six-month period show that one Party’s Development Costs for such six-month period were greater than [*], then the other Party (the “Reimbursing Party”) shall pay the first Party, within ninety (90) days after the end of such six-month period, an amount equal to [*], provided that the total Development Costs for each Co-Developed Product for such six-month period did not exceed [*] for such product for such six-month periodbe funded and reimbursed as described in Attachment 1. (id) If the total Each party shall maintain books of account and complete and accurate records of all of its Development Costs exceed in sufficient detail to permit the other party to confirm the correctness of such [*] by more than [*] for such six-month period and items. Each party shall provide the Reimbursing Party’s other party, upon reasonable request, with copies of invoices supporting significant third party expenditures. * To the extent actual Development Costs for such six-month period for such product were less than [*]vary from reported Development Costs, then the Reimbursing Party adjustments shall first pay the other Party an amount equal be made to the difference between (A) the Development Costs incurred by the Reimbursing Party for such product in such six-month period and (B) [*]future invoices. (iie) The Reimbursing Party’s obligation Additional details relating to reimburse the other Party definition, calculation, reporting requirements and reimbursement procedures for [*] of all such Development Costs are set forth in excess of [*] shall be limited to (A) those additional Development Costs approved by the JDC (either before or after they are incurred) and (B) those additional Development Costs that are the result of work carried out in response to a governmental requirement (imposed or directed following preparation of such Development Budget) to do such work. If, after any payment by the Reimbursing Party pursuant to Section 5.11(c)(i), the Reimbursing Party’s total Development Cost expenditures, including such payment, (collectively “Z”) are less than [*] where X is [*] and Y is 100% of such reimbursable additional Development Costs, then the Reimbursing Party shall pay the other Party an amount equal to [*]. Failure of a Party to reimburse the other Party for any Development Costs that are subject to a good faith dispute hereunder shall not be deemed to be a material breach of this AgreementAttachment 1.

Development Costs. The Parties shall each bear fifty percent (a50%) Subject to Sections 5.11(c) and 5.12, of all Development Costs for initial and subsequent indications; provided, however, that Jazz shall be borne [*]. (b) In accordance with procedures to be established by the JDC, each Party shall calculate and maintain records of bear all Development Costs incurred with respect to activities that are not part of a global clinical trial and that are conducted primarily for the purpose of obtaining or maintaining Regulatory Approval for the Licensed Product within the Jazz Territory other than the United States or the EU. For clarity, the purpose of the Development activities, rather than the location where such activities are conducted, shall determine whether the associated Development Costs will be shared equally by itthe Parties or borne by Jazz. Within sixty (60) Each Party shall provide the other with a non-binding estimate of its Development Costs incurred or to be incurred by such Party for each Calendar Quarter at least [***] days before the end of such Calendar Quarter. No later than [***] days after the end of each six-month period (ending June 30 and December 31) during which the Parties are co-developing at least one Co-Developed ProductCalendar Quarter, each Party shall send provide to the other Party a reasonably detailed report which specifies showing all Development Costs incurred by such Party during the previous Calendar Quarter subject to the limitation set forth in the last sentence in this Section 6.2.1 (each such report, a “Development Costs Report”). Within [***] days after the date that both Parties have received a Development Costs Report with respect to a particular Calendar Quarter, the Party that has paid more than fifty percent (50%) of the aggregate Development Costs incurred by both Parties for the applicable Calendar Quarter shall provide the other Party with an invoice for an amount equal to fifty percent (50%) of the difference between the Development Costs incurred by such Party during such six-month period with respect to each Co-Developed Product in the Co-Developed Territory. The Parties shall seek to resolve any questions related to such accounting statements within ninety (90) days following receipt. (c) If the reports for a particular six-month period show that one Party’s Development Costs for such six-month period were greater than [*], then the other Party (the “Reimbursing Party”) shall pay the first Party, within ninety (90) days after the end of such six-month period, an amount equal to [*], provided that the total Development Costs for each Co-Developed Product for such six-month period did not exceed [*] for such product for such six-month period. (i) If the total Development Costs exceed such [*] by more than [*] for such six-month period Calendar Quarter and the Reimbursing Party’s Development Costs for such six-month period for such product were less than [*], then the Reimbursing Party shall first pay the other Party an amount equal to the difference between (A) the Development Costs incurred by the Reimbursing other Party for such product in Calendar Quarter, and such six-month period and (B) other Party shall pay such invoice within [*]. (ii) The Reimbursing Party’s obligation **] days of receipt, using the wire transfer provisions of Section 6.6.4. Notwithstanding the foregoing, in no event shall a Party be required 5 Include applicable amount of Jazz Option Exercise Fee under the Collaboration and Option Agreement. 6 [***] to reimburse the other Party for [*] of all such Development Costs incurred by such other Party in any Calendar Quarter in excess of [*] shall be limited to (A) those additional Development Costs approved by the JDC (either before or after they are incurred) and (B) those additional Development Costs that are the result of work carried out in response to a governmental requirement (imposed or directed following preparation of such Development Budget) to do such work. If, after any payment by the Reimbursing Party pursuant to Section 5.11(c)(i), the Reimbursing Party’s total Development Cost expenditures, including such payment, (collectively “Z”) are less than [**] where X is [*] and Y is 100% of the amount set forth in the Development Plan Budget for such reimbursable additional Development Costs, then Calendar Quarter for the Reimbursing Party shall pay activities for which the other Party an amount equal is responsible under the Development Plan, as the Development Plan and Development Plan Budget may be amended from time to time. If a Party anticipates incurring costs in excess of [*]. Failure **] of a the amount set forth in the Development Plan Budget for activities for which such Party to reimburse is responsible under the Development Plan, (i) such Party shall notify the other Party for any and may request an increase the Development Costs that are subject Plan Budget to a cover such excess costs, (ii) the other Party shall consider such request in good faith dispute hereunder and shall not be deemed deny such request to the extent that such excess costs are due to unforeseeable events outside of the reasonable control of such Party, and (iii) such Party shall continue to be a material breach responsible for the performance of this Agreementsuch activities under the Development Plan and, unless the Parties mutually agree to an amendment to the Development Plan and Development Plan Budget, such Party shall be responsible for [***] of such excess costs.

Development Costs. Within [***] after the end of each Calendar Quarter during which a Party (athe “Incurring Party”) Subject to Sections 5.11(c) and 5.12, incurs any Development Costs that are subject to reimbursement by the other Party in accordance with Section 4.3, the Incurring Party shall submit to the other Party a reasonably detailed report of the Development Costs incurred by such Incurring Party or its Affiliates in accordance with this Agreement in such Calendar Quarter together with reasonable supporting documentation and an invoice for such Development Costs. For the avoidance of doubt, no cost or expense shall be borne counted more than once in calculating Development Costs, even if such costs or expense falls into more than one of the cost categories that comprise Development Costs. Each Party shall record and account for its FTE effort to the extent that such FTE efforts are included in Development Costs that are shared under this Agreement, and shall report such FTE effort to the JSC, if requested (such request not to be more than on a [*]. (b) In accordance with procedures to be established by the JDC, each **] basis). Each Party shall calculate and maintain records of FTE effort incurred by it in the same manner as used for other products developed by such Party, unless instructed by the JSC to employ other procedures, in which case such other procedures shall be applied equally to both Parties. The other Party shall pay its portion of the Development Costs incurred by itin the amount invoiced within [***] after receipt of such invoice. Within sixty (60) days after the end of each six-month period (ending June 30 and December 31) during which the Parties are co-developing at least one Co-Developed Product, each Each Party shall send perform (or shall procure the performance of) such further acts, and to execute and deliver (or to procure the execution and delivery of) such further agreements and documents, as may be required by Applicable Law or as the other Party a report which specifies the Development Costs incurred by such Party during such six-month period with respect may reasonably require to each Co-Developed Product in the Co-Developed Territory. The Parties shall seek to resolve any questions related to such accounting statements within ninety (90) days following receipt. (c) If the reports for a particular six-month period show that one Party’s Development Costs for such six-month period were greater than [*], then the other Party (the “Reimbursing Party”) shall pay the first Party, within ninety (90) days after the end of such six-month period, an amount equal to [*], provided that the total Development Costs for each Co-Developed Product for such six-month period did not exceed [*] for such product for such six-month period. (i) If the total Development Costs exceed such [*] by more than [*] for such six-month period and the Reimbursing Party’s Development Costs for such six-month period for such product were less than [*], then the Reimbursing Party shall first pay the other Party an amount equal to the difference between (A) the Development Costs incurred by the Reimbursing Party for such product in such six-month period and (B) [*]. (ii) The Reimbursing Party’s obligation to reimburse the other Party for [*] of all such Development Costs in excess of [*] shall be limited to (A) those additional Development Costs approved by the JDC (either before or after they are incurred) and (B) those additional Development Costs that are the result of work carried out in response to a governmental requirement (imposed or directed following preparation of such Development Budget) to do such work. If, after any payment by the Reimbursing Party pursuant to Section 5.11(c)(i), the Reimbursing Party’s total Development Cost expenditures, including implement such payment. Notwithstanding the foregoing, (collectively “Z”) are less than [*] where X is [*] and Y is 100% of such reimbursable additional Development Costs, then the Reimbursing Party shall pay the other Party an amount equal to [*]. Failure of a Party to reimburse the other Party for any Development Costs may withhold amounts that are subject to a good faith dispute. If the Parties cannot agree on the reimbursement of Development Costs, the Parties shall resolve such dispute hereunder shall not be deemed to be a material breach of this Agreementin accordance with Article 15.

Development Costs. (a) Subject to Sections 5.11(c) and 5.12, The parties shall share Development Costs as follows: (i) From the Effective Date, Roche shall be borne [responsible for payment of eighty percent (80%) of the Development Costs * and Agouron shall be responsible for payment of twenty percent (20%) of such Development Costs; provided, however, that Roche shall not be responsible for Development Costs incurred for services performed before June 19, 1996, even if such services are paid for after such date. If Agouron has elected to Co-Promote a Product arising out of the Development Program for cancer indications in one or more European Co-Promotion Countries, *]. (ii) Development Costs incurred for services * In addition to its twenty percent (20%) share of worldwide Development Costs because of its Co-Promotional activities in the North American Territory, * (iii) Agouron's prorata percentage share of Development Costs for such European Co-Promotion Country * (iv) Development Costs allocated to a European Co-Promotion Country shall Unless the parties agree otherwise, * shall be deemed to have been incurred for the benefit of the * (b) In accordance with procedures to be established by the JDC, each Party shall calculate and maintain records of Development Costs incurred by it. Within sixty (60) * days after the end of each sixa semi-month annual calendar period (ending on either June 30 and or December 31) 31 during which the Parties are co-developing at least one Co-Developed Productparties have incurred Development Costs, each Party party shall send prepare and deliver to the other Party party a report which specifies the full and true accounting of such party's actual Development Costs incurred by for such Party during such sixsemi-month period with respect to each Co-Developed Product in the Co-Developed Territoryannual period. The Parties form of the report shall seek be consistent with the format presented in Schedule 1 to resolve Attachment 1, and shall detail actual Development Costs by major cost categories, consistent with the accounting classifications and methods agreed upon by the parties. The accuracy of the report shall be reviewed and signed by an appropriate financial employee of the reporting party. The calculation of Development Costs shall not include any questions related to such accounting statements within ninety (90) days following receiptselling or marketing costs and expenses. (c) If the reports for a particular six-month period show that one Party’s Development Costs for such six-month period were greater than [*], then the other Party (the “Reimbursing Party”) shall pay the first Party, within ninety (90) days after the end of such six-month period, an amount equal to [*], provided that the total Development Costs for each Co-Developed Product for such six-month period did not exceed [*] for such product for such six-month periodbe funded and reimbursed as described in Attachment 1. (id) If the total Each party shall maintain books of account and complete and accurate records of all of its Development Costs exceed in sufficient detail to permit the other party to confirm the correctness of such [*] by more than [*] for such six-month period and items. Each party shall provide the Reimbursing Party’s other party, upon reasonable request, with copies of invoices supporting significant third party expenditures. * To the extent actual Development Costs for such six-month period for such product were less than [*]vary from reported Development Costs, then the Reimbursing Party adjustments shall first pay the other Party an amount equal be made to the difference between (A) the Development Costs incurred by the Reimbursing Party for such product in such six-month period and (B) [*]future invoices. (iie) The Reimbursing Party’s obligation Additional details relating to reimburse the other Party definition, calculation, reporting requirements and reimbursement procedures for [*] of all such Development Costs are set forth in excess of [*] shall be limited to (A) those additional Development Costs approved by the JDC (either before or after they are incurred) and (B) those additional Development Costs that are the result of work carried out in response to a governmental requirement (imposed or directed following preparation of such Development Budget) to do such work. If, after any payment by the Reimbursing Party pursuant to Section 5.11(c)(i), the Reimbursing Party’s total Development Cost expenditures, including such payment, (collectively “Z”) are less than [*] where X is [*] and Y is 100% of such reimbursable additional Development Costs, then the Reimbursing Party shall pay the other Party an amount equal to [*]. Failure of a Party to reimburse the other Party for any Development Costs that are subject to a good faith dispute hereunder shall not be deemed to be a material breach of this AgreementAttachment 1.

Development Costs. The Parties shall share Development Costs incurred by or on behalf of either Party or its Affiliates after the Effective Date solely to the extent related to Development of the Licensed Compounds or Licensed Products in the Territory, such sharing to be as follows: (a1) Subject for Development Costs incurred prior to Sections 5.11(cthe Amendment Effective Date, Gilead shall be responsible for eighty percent (80%) and 5.12, Galapagos shall be responsible for twenty percent (20%) and (2) for Development Costs shall be borne [*]. (b) In accordance with procedures to be established by incurred on or after the JDCAmendment Effective Date, each Party shall calculate and maintain records be responsible for fifty percent (50%) (regardless of Development Costs incurred by itthe date of invoice or payment). Within sixty (60) days […***…] Business Days after the end of each six-month period (ending June 30 and December 31) during which the Parties are co-developing at least one Co-Developed Productcalendar quarter, each Party shall send provide to the other Party a report which specifies the in reasonable detail of any Development Costs incurred by such Party during in such six-month period with respect to calendar quarter for each Co-Developed Product in the Co-Developed TerritoryLicensed Product. The Parties shall seek to resolve any questions related to such accounting statements within ninety (90) days following receipt. (c) If the reports for a particular six-month period show that one Party’s Development Costs so reported will be used for such six-month period were greater than the calculation of the 80%/20% split or the 50%/50% split for the Development Costs, as applicable. Within […*], then the other Party (the “Reimbursing Party”) shall pay the first Party, within ninety (90) days **…] Business Days after the end of each calendar quarter, Gilead shall send Galapagos a consolidated report in reasonable detail regarding such six-month period, an amount equal to [*], provided that the total Development Costs for each Co-Developed Product for such six-month period did not exceed [*] for such product for such six-month period. (i) If the total Development Costs exceed such [*] by more than [*] for such six-month period and the Reimbursing Party’s Development Costs for such six-month period for such product were less than [*], then the Reimbursing Party shall first pay the other Party an amount equal to the difference between (A) the Development Costs incurred by the Reimbursing each Party for such product calendar quarter. Within […***…] days following receipt of such report, the Party whose Development Cost expenditures exceed the portion of the total such expenditures by both Parties for such calendar quarter allocated to such Party in such six-month period and (B) [*]. (ii) The Reimbursing Party’s obligation to reimburse this Section 3.4 shall invoice the other Party for the amount of funds necessary to account for such excess. The Party receiving such invoice shall pay it not later than […***…] of all such Development Costs in excess of [*] days following receipt thereof. For clarity, Gilead shall be limited to (A) those additional solely responsible for all costs and expenses incurred by or on behalf of Gilead in the Development Costs approved by of Gilead Combination Products in the JDC (either before or after they are incurred) and (B) those additional Development Costs that are the result of work carried out in response to a governmental requirement (imposed or directed following preparation of such Development Budget) to do such workTerritory. If, after any payment by the Reimbursing Party pursuant to Section 5.11(c)(i), the Reimbursing Party’s total Development Cost expenditures, including such payment, (collectively “Z”) are less than […*] where X is [*] and Y is 100% of such reimbursable additional Development Costs, then the Reimbursing Party shall pay the other Party an amount equal to [*…]. Failure of a Party to reimburse the other Party for any Development Costs that are subject to a good faith dispute hereunder shall not be deemed to be a material breach of this Agreement.