Since the news, the shares have soared from pounds 10.43, with one deal going through at pounds 25 last week. Mr Lewis's sale at pounds 17.60 a share netted him a pounds 1.5m profit, with fellow board member James Noble making a further pounds 1.7m from option sales yesterday. The shares closed last night down 110p at pounds 16.08.
Speaking from the company's Oxford base yesterday, Dr Lewis said the options "represented 90 per cent of my financial position and I had to shelter some of my position, as it were. I still think it is a very good company and think the shares will go up further, but I felt I had to protect my position."
Dr Lewis said he had "a very good reason" for raising the cash now as a loss-making name at the Lloyd's of London insurance market. He faces a cash call next year from the new Equitas reinsurance vehicle designed to protect names from huge past losses.
He admitted that the sale "looks unusual", but said that companies like British Biotech were more usual in the US and similar option sales were "a very, very common occurrence" there. He suggested that British Biotech was already looking like US success stories, such as Amgen and Genentech, which had been built up from scratch.
Dr Lewis was previously vice-president of product development at Marion Merrell Dow, a big US pharmaceuticals group. "The fact of the matter is I consider that these options were part of the package which took me to the company in the first place", he said. "I wouldn't have come without them." Dr Lewis claimed they were part of the "entrepreneurial start-up culture" of a company like British Biotech.
Dr Lewis exercised his right to convert 106,695 options at 337p a share. He immediately sold 106,000 at the prevailing market price of pounds 17.60, making a profit of pounds 1.5m on the deal. Mr Noble, finance director, exercised 106,695 at 187p and a further 16,000 at 337p. His sale of 110,000 shares left him with a gain of pounds 1.7m.
The company's shares soared 48 per cent last Thursday, adding pounds 244m to its stock market value, after it announced what may be a breakthrough in the treatment of cancer. One deal in the shares went through at over pounds 26 last week, but since then the share price has fallen back, not helped by the news of directors' dealings.
City analysts have become excited by the prospects for Marimastat, an oral drug which has shown some effectiveness in halting the growth or reducing the size of cancerous tumours in trials. Some estimates have suggested eventual revenues could top $1bn.
However, the results, covering 94 late-stage cancer patients, are only preliminary and the drug has a long way to go before gaining approval from the regulatory authorities. Meanwhile, British Biotech, which was floated at 425p a share in 1992, has yet to show a profit or pay its investors a dividend.