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Stockholders' Equity (Tables)
 3 Months Ended
Mar. 31, 2017
Earnings Per Common Share  
Schedule of components of basic and diluted earnings per common share

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

 

 

Three Months Ended
March 31,

 

 

 

2017

 

2016

 

Numerator:

 

 

 

 

 

Net income

 

$
178.6

 

$
235.5

 

 

 

 

 

 

 

 

 

Denominator:

 

 

 

 

 

Weighted average outstanding shares — basic

 
44.5

 
45.4

 

Effect of dilutive securities(1):

 

 

 

 

 

Warrants

 
0.3

 
2.4

 

Stock options, restricted stock units and employee stock purchase plan

 
1.1

 
0.8

 

Convertible notes

 

—

 
0.1

 

 

 

 

 

 

 

Weighted average shares — diluted(2)

 
45.9

 
48.7

 

 

 

 

 

 

 

Earnings per common share:

 

 

 

 

 

Basic

 

$
4.01

 

$
5.19

 

Diluted

 

$
3.89

 

$
4.84

 

 

 

 

 

 

 

Stock options, convertible notes and warrants excluded from calculation(2)

 
1.8

 
4.1

 

 

 

 

 

 

 

 

 

(1)

Calculated using the treasury stock method.

 

(2)

Certain stock options and warrants have been excluded from the computation of diluted earnings per share because their impact would be anti-dilutive for the three-month periods ended March 31, 2017. Additionally, certain convertible notes were excluded for the three-month periods ended March 31, 2016. 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  
Summary of weighted-average assumptions used to measure the fair value of the stock options granted

 

 

March 31,
2017

 

March 31,
2016

 

Expected volatility

 
35.7

%
34.7

%

Risk-free interest rate

 
2.2

%
1.6

%

Expected term of awards (in years)

 
6.1

 
5.8

 

Expected dividend yield

 
0.0

%
0.0

%

 

Schedule of the activity and status of stock options

 

 

Number of
Options

 

Weighted-
Average
Exercise
Price

 

Weighted
Average
Remaining
Contractual
Term (Years)

 

Aggregate
Intrinsic
Value
(in millions)

 

Outstanding at January 1, 2017

 
4,459,291

 

$
104.97

 

 

 

 

 

Granted

 
1,906,683

 
146.15

 

 

 

 

 

Exercised

 
(334,065

)
98.69

 

 

 

 

 

Forfeited/canceled

 
(38,069

)
129.57

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Outstanding at March 31, 2017

 
5,993,840

 

$
118.26

 
7.7

 

$
129.5

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercisable at March 31, 2017

 
3,154,307

 

$
101.23

 
6.0

 

$
113.9

 

 

 

 

 

 

 

 

 

 

 

 

 

Unvested as of March 31, 2017

 
2,839,533

 

$
137.19

 
9.6

 

$
15.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Summary of stock option exercise data

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

 

 

Three Months Ended
March 31,

 

 

 

2017

 

2016

 

Number of options exercised

 
334,065

 
81,105

 

Cash received

 

$
33.0

 

$
2.6

 

Total intrinsic value of options exercised

 

$
20.3

 

$
7.6

 

 

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

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

 

 

Three Months Ended
March 31,

 

 

 

2017

 

2016

 

Cost of product sales

 

$
0.2

 

$
0.1

 

Research and development

 
0.5

 
0.1

 

Selling, general and administrative

 
3.9

 
2.9

 

 

 

 

 

 

 

Share-based compensation expense before taxes

 
4.6

 
3.1

 

Related income tax benefit

 
(1.7

)
(1.1

)

 

 

 

 

 

 

Share-based compensation expense, net of taxes

 

$
2.9

 

$
2.0