Stockholders' Equity (Tables)

9 Months Ended

Sep. 30, 2016

Earnings Per Common Share

Schedule of components of basic and diluted earnings per share

The components of basic and diluted earnings per common share comprised the following (in millions, except per share amounts):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
Numerator:
Net income	$	161.8	$	464.4	$	603.4	$	547.0
Denominator:
Weighted average outstanding shares — basic	43.2		45.5		44.3		46.1
Effect of dilutive securities(1):
Warrants	2.3		3.0		2.3		3.1
Stock options, restricted stock units and employee stock purchase plan	0.7		1.2		0.7		1.4
Convertible notes	—		0.5		—		1.1
Weighted average shares — diluted(2)	46.2		50.2		47.3		51.7
Earnings per common share:
Basic	$	3.75	$	10.20	$	13.62	$	11.86
Diluted	$	3.50	$	9.24	$	12.76	$	10.58
Stock options and warrants excluded from calculation(2)	5.3		3.0		5.3		4.1

(1) Calculated using the treasury stock method.

(2) Certain convertible notes, stock options and warrants have been excluded from the computation of diluted earnings per share because their impact would be anti-dilutive. Under our convertible note hedge agreement, we were entitled to receive shares required to be issued to investors upon conversion of our Convertible Notes. Since related shares used to compute dilutive earnings per share would be anti-dilutive, they have been excluded from the calculation above.

Stock Options

Stock Option Plan

Weighted-average assumptions used to measure the fair value of the stock options granted

	September 30, 2016		September 30, 2015
Expected volatility	34.8	%	33.1	%
Risk-free interest rate	1.6	%	2.0	%
Expected term of awards (in years)	5.8		5.8
Expected forfeiture rate	5.4	%	1.0	%
Expected dividend yield	0.0	%	0.0	%

Schedule of stock option activity

	Number of Options		Weighted- Average Exercise Price		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in millions)
Outstanding at January 1, 2016	3,247,438		$	93.09
Granted	1,625,552		119.33
Exercised	(196,984	)	31.73
Forfeited	(165,492	)	120.78
Outstanding at September 30, 2016	4,510,514		$	104.21	7.2	$	83.3
Exercisable at September 30, 2016	3,278,204		$	98.49	6.3	$	81.9
Expected to vest as of September 30, 2016	1,152,335		$	119.30	9.5	$	1.4

Summary of stock option exercise data

Stock option exercise data is summarized below (dollars in millions):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
Number of options exercised	42,443		210,256		196,984		807,755
Cash received	$	1.2	$	8.6	$	6.2	$	33.0
Total intrinsic value of options exercised	$	3.9	$	25.3	$	17.3	$	101.1

Schedule of total share-based compensation expense relating to stock options

Total share-based compensation expense relating to stock options and restricted stock units is as follows (in millions):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016			2015
Cost of product sales	$	0.1		$	—		$	0.3		$	—
Research and development	0.5			—			1.0			—
Selling, general and administrative	3.2			2.5			21.0			2.5
Share-based compensation expense before taxes	3.8			2.5			22.3			2.5
Related income tax benefit	(1.4		)	(0.9		)	(8.2		)	(0.9		)
Share-based compensation expense, net of taxes	$	2.4		$	1.6		$	14.1		$	1.6