Note 9. Stock-Based Compensation

The following table summarizes stock-based compensation expense by financial statement line item in the Company’s consolidated statements of operations for the three and six months ended September 30, 2018 and 2017:

	For the Three Months Ended September 30,				For the Six Months Ended September 30,
		2018		2017		2018		2017
	(in $000's)				(in $000's)
Cost of product revenue	$	774	$	372	$	1,349	$	731
Research and development		2,618		1,205		4,584		2,544
Selling, general and administrative		12,542		7,705		22,246		14,663
	$	15,934	$	9,282	$	28,179	$	17,938

Stock Options

The following table summarizes the stock option activity for the six months ended September 30, 2018:

						Weighted
				Weighted		Average		Aggregate
				Average		Remaining		Intrinsic
	Options			Exercise		Contractual		Value
	(in thousands)			Price		Term (years)		(in thousands)
Outstanding at beginning of period		1,282		$	46.18		5.31
Granted		76			383.96
Exercised		(425	)		24.95
Cancelled and expired		(15	)		153.17
Outstanding at end of period		918		$	83.05		5.97	$	331,490
Exercisable at end of period		669		$	38.86		4.97	$	271,255
Options vested and expected to vest at end of period		905		$	82.85		5.94	$	327,147

Stock options generally vest and become exercisable annually over three years. The remaining unrecognized stock-based compensation expense for unvested stock option awards at September 30, 2018 was approximately $15.8 million and the estimated weighted-average period over which this cost will be recognized is 2.3 years.

The aggregate intrinsic value of options exercised was $155.4 million for the six months ended September 30, 2018. The total cash received as a result of employee stock options exercised during the six months ended September 30, 2018 was approximately $10.6 million.

The Company estimates the fair value of each stock option granted at the grant date using the Black-Scholes option valuation model. The weighted average grant-date fair values and weighted average assumptions used in the calculation of fair value of options granted during the three and six months ended September 30, 2018 and 2017 was as follows:

	For the Three Months Ended September 30,						For the Six Months Ended September 30,
		2018			2017			2018			2017
Weighted average grant-date fair value	$	148.51		$	57.38		$	142.81		$	50.26

Valuation assumptions:
Risk-free interest rate		2.87	%		1.88	%		2.93	%		1.85	%
Expected option life (years)		3.99			4.06			4.04			4.07
Expected volatility		43.9	%		43.4	%		42.7	%		43.6	%

Restricted Stock Units

The following table summarizes activity of restricted stock units for the six months ended September 30, 2018:

	Number of Shares			Weighted Average Grant Date Fair Value
	(in thousands)			(per share)
Restricted stock units at beginning of period		880		$	109.01
Granted		192		$	379.63
Vested		(404	)	$	103.91
Forfeited		(20	)	$	187.41
Restricted stock units at end of period		649		$	189.87

Restricted stock units generally vest annually over three years. The remaining unrecognized compensation expense for outstanding restricted stock units, including performance and market-based awards, as of September 30, 2018 was $72.1 million and the estimated weighted-average period over which this cost will be recognized is 2.3 years.

The weighted average grant-date fair value for restricted stock units granted during the six months ended September 30, 2018 was $379.63. The total fair value of restricted stock units vested during the six months ended September 30, 2018 was $163.3 million.

Performance-Based Awards

In May 2018, performance-based awards of restricted stock units for the potential issuance of approximately 114,000 shares of common stock were issued to certain executive officers and employees, which vest upon achievement of prescribed service milestones by the award recipients and performance milestones by the Company. As of September 30, 2018, the Company is recognizing compensation expense based on the probable outcome related to the prescribed performance targets on the outstanding awards.