Common use of Cost Share Clause in Contracts

Cost Share. 7.8.1. Within [***] after AbbVie first doses a subject in a pivotal clinical trial for a Cost-Share Product after Morphic exercises its Cost-Share Option with respect to such Cost-Share Product in accordance with Section 5.7.1(b), Morphic shall reimburse AbbVie (a) [***] of any Milestone Payment set forth in Section 7.2.1(1) or (2) and (b) [***] of any Milestone Payment set forth in Section 7.2.1(3), in each case ((a) and (b)), with respect to the applicable Cost-Share Product that AbbVie paid to Morphic prior to Morphic’s exercise of its Cost-Share Option with respect to such Cost-Share Product. 7.8.2. If Morphic exercises its Cost-Share Option with respect to a Cost-Share Product, within [***] days after (a) Morphic exercises its Cost-Share Option with respect to such Cost-Share Product in accordance with Section 5.7.1(b) and (b) the end of each Calendar Quarter thereafter, in each case ((a) and (b)), AbbVie shall provide to Morphic a summary report of the Development Costs incurred by or on behalf of AbbVie or its Affiliates during such Calendar Quarter (or, with respect to the first such report, since the Inclusion Date with respect to the applicable Included Target) with respect to such Cost-Share Product (each, a “Development Cost Report”). 7.8.3. Subject to Section 5.7.1(d), within [***] after receipt of each such Development Cost Report, Morphic shall reimburse AbbVie for [***] of the Development Costs set forth therein for such Cost-Share Product; provided that, if the Development Costs incurred by or on behalf of AbbVie or its Affiliates in any Calendar Quarter exceed the Cost-Share Budget for such Calendar Quarter by more than [***] of the Cost-Share Budget for such Calendar Quarter, an “Overrun”), Morphic may elect to defer payment of such Overrun in accordance with Section 7.8.4 upon written notice to AbbVie within [***] after receipt of the applicable Development Cost Report. If Morphic disputes any portion of any Development Cost Report, it shall promptly provide AbbVie with written notice of the disputed portion and its reasons therefor, and the Parties shall use good faith efforts to resolve any such disputes promptly. 7.8.4. Subject to Section 5.7.1(d), if Morphic elects to defer payment of any Overrun with respect to a Cost-Share Product with respect to any Calendar Quarter, Morphic shall pay to AbbVie an amount equal to such Overrun deferred in such Calendar Quarter within [***] after the date that Morphic notifies AbbVie it elects to defer such Overrun in accordance with Section 7.8.3. For clarity, if Morphic exercises its Opt-Out Right for a Cost-Share Product, the foregoing Overrun payment obligations shall continue to apply with respect to Morphic’s cost-sharing obligations.