Biotech man defends his pounds 1.5m share option profit

Cash gains: Research head at cancer drug group reveals Lloyd's losses 8 Former ad agency chiefs make pounds 10m in multimedia launch

Peter Lewis, head of research and development at British Biotech, yesterday defended his decision to cash in share options just days after the group announced a potential breakthrough in cancer treatment.

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.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Customer Service Advisor

£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

Recruitment Genius: Compliance Manager

£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

SThree: Talent Acquisition Consultant

£22500 - £27000 per annum + OTE £45K: SThree: Since our inception in 1986, STh...

Day In a Page

John Palmer: 'Goldfinger' of British crime was murdered, say police

Murder of the Brink’s-MAT mastermind

'Goldfinger' of British crime's life ended in a blaze of bullets, say police
Forget little green men - aliens will look like humans, says Cambridge University evolution expert

Forget little green men

Leading evolutionary biologist says aliens will look like humans
The Real Stories of Migrant Britain: An Algerian scientist adjusts to life working in a kebab shop

The Real Stories of Migrant Britain

An Algerian scientist struggles to adjust to her new life working in a Scottish kebab shop
Bodyworlds museum: Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy

Dying dream of Doctor Death

Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy
UK heatwave: Temperature reaches 39.8 degrees on Central Line - the sweatiest place in London

39.8 degrees recorded on Tube

There's hot (London) and too damn hot (the Underground). Simon Usborne braved the Central line to discover what its passengers suffer
Kitchens go hi-tech: From robot chefs to recipe-shopping apps, computerised cooking is coming

Computerised cooking is coming

From apps that automatically make shopping lists from your recipe books to smart ovens and robot chefs, Kevin Maney rounds up innovations to make your mouth water
Jessie Cave interview: The Harry Potter star has published a feminist collection of cartoons

Jessie Cave's feminist cartoons

The Harry Potter star tells Alice Jones how a one-night stand changed her life
Football Beyond Borders: Even the most distruptive pupils score at homework club

Education: Football Beyond Borders

Add football to an after-school homework club, and even the naughtiest boys can score
10 best barbecue books

Fire up the barbie: 10 best barbecue books

We've got Bibles to get you grilling and smoking like a true south American pro
Wimbledon 2015: Nick Bollettieri - Junk balls and chop and slice are only way 5ft 1in Kurumi Nara can live with Petra Kvitova’s power

Nick Bollettieri's Wimbledon Files

Junk balls and chop and slice are only way 5ft 1in Kurumi Nara can live with Petra Kvitova’s power
Ron Dennis exclusive: ‘This is one of the best McLaren teams ever – we are going to do it’

‘This is one of the best McLaren teams ever – we are going to do it’

Ron Dennis shrugs off a poor start to the season in an exclusive interview, and says the glory days will come back
Seifeddine Rezgui: What motivated a shy student to kill 38 holidaymakers in Tunisia?

Making of a killer

What motivated a shy student to kill 38 holidaymakers in Tunisia?
UK Heatwave: Temperatures on the tube are going to exceed the legal limit for transporting cattle

Just when you thought your commute couldn't get any worse...

Heatwave will see temperatures on the Tube exceed legal limit for transporting cattle
Exclusive - The Real Stories of Migrant Britain: Swapping Bucharest for London

The Real Stories of Migrant Britain

Meet the man who swapped Romania for the UK in a bid to provide for his family, only to discover that the home he left behind wasn't quite what it seemed
Cheaper energy on the way, but it's not all sunshine and rainbows

Cheaper energy on the way, but it's not all sunshine and rainbows

Solar power will help bring down electricity prices over the next five years, according to a new report. But it’s cheap imports of ‘dirty power’ that will lower them the most