Development Plans As soon as practicable after formation of the JDC, the JDC shall prepare and approve the initial Development Plan for Development of the Licensed Product for the Initial Indication in the formulation existing as of the Effective Date in the Territory. The Parties shall use Commercially Reasonable Efforts to ensure that such initial Development Plan is consistent with the general Development Plan outline set forth in Exhibit B attached hereto and incorporated herein (the “General Development Plan Outline”). The JDC shall prepare and approve a separate Development Plan for Development of Licensed Product for the Initial Indication in the Initial Formulation in the Territory and for Development of each Other Indication Product and New Formulation (if any) in the Territory, and shall update and amend each Development Plan not less than annually or more frequently as needed to take into account changed circumstances or completion, commencement or cessation of Development activities not contemplated by the then-current Development Plan. Amendments and revisions to the Development Plan shall be reviewed and discussed, in advance, by the JDC, and Otsuka agrees to consider proposals and suggestions made by Acucela regarding amendments and revisions to the Development Plan. Any amendment or revision to the Development Plan that provides for an increase or decrease in the number of FTEs as compared to the previous version of the Development Plan, or that provides for addition or discontinuation of tasks or activities as compared to the previous version of the Development Plan, or that moves forward the timetable for activities reflected in the Development Plan, shall provide for a reasonable ramp-up or wind-down period, as applicable, to accommodate a smooth and orderly transition of Development activities to the amended or revised Development Plan. Each Development Plan shall identify the goals of the Development program contemplated thereunder and shall address Development activities related to the Licensed Compound or the Licensed Product (including, if applicable, any Other Indication Product or New Formulation), including:
(i) the budget for Development Costs (and costs of Phase 4 Clinical Trials, if any) for the forthcoming calendar year (or portion thereof), including a reasonably detailed allocation of such costs and expenses among the activities expected to be conducted, including the number of FTEs (subject to Section 4.2) and the applicable FTE Rate and out-of-pocket expenses to be incurred in such calendar year (or portion thereof), and a reasonable good faith projection of the budget for Development Costs (and costs of Phase 4 Clinical Trials, if any) for Development activities in the Development Plan after such calendar year, in each case which budget shall be an amount reasonably intended to be sufficient to cover the anticipated costs associated with the activities reflected in the Development Plan;
(ii) clinical trials (including Phase 4 Clinical Trials but excluding Phase 3b Clinical Trials or Post-Approval Studies) to generate data for use in seeking, obtaining or maintaining Regulatory Approval and for labeling of the Licensed Product for the Initial Indication in the Initial Formulation or, if applicable, Other Indication Product or New Formulation, including study protocol design;
(iii) resources required to perform each required Development activity, including the scope of the work to be performed by internal resources of each of the Parties or by CROs or other permitted subcontractors, if applicable;
(iv) milestones to be met, deliverables to be provided and the timeline for completion of each Development activity;
(v) the members of the Development team, which must include at least one individual who has sufficient expertise and experience in ophthalmology drug development in the Initial Indication;
(vi) design and implementation of regulatory strategy; and
(vii) forecasts of quantities of Licensed Product to be supplied by Otsuka for use in clinical trials in the Territory.