3. Inventory and Other Deferred Costs

Inventory and other deferred costs consists of the following:


	December 31, 2017		December 31, 2016
	(in thousands)
Raw materials	$	3,200	$	2,810
Work-in-process		3,745		2,489
Finished products		12,278		11,662
Other deferred costs		1,823		2,617

Total inventory and other deferred costs	$	21,046	$	19,578

We held inventory on consignment of $1.4 million and $1.1 million as of December 31, 2017 and 2016, respectively.

In connection with our recent acquisition of the RestoreFlow allograft business, other deferred costs include costs incurred for the preservation of human vascular tissues available for shipment, tissues currently in active processing, and tissues held in quarantine pending release to implantable status. By federal law, human tissues cannot be bought or sold. Therefore, the tissues we preserve are not held as inventory, and the costs we incur to procure and process vascular tissues are instead accumulated and deferred. These costs include fixed and variable overhead costs associated with the cryopreservation process, including primarily direct labor costs, tissue recovery fees, inbound freight charges, indirect materials and facilities costs. General and administrative expenses and selling expenses associated with the provision of these services are expensed as incurred.