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
ebooksA special investigation by Andy McSmith
  • Get to the point
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: Financial Adviser

£20000 - £60000 per annum: Recruitment Genius: Are you recently QCA Level 4 qu...

SThree: Graduate Recruitment Resourcer

£20000 - £22500 per annum + OTE £30K: SThree: SThree Group have been well esta...

Guru Careers: Application Support Analyst / 1st Line Support

£25 - 30k: Guru Careers: We are seeking an Application Support Analyst / 1st L...

Guru Careers: .NET Developer / Web Developer

£45K - £55K (DOE) + Benefits: Guru Careers: We are seeking a full stack .NET D...

Day In a Page

Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

How a costume drama became a Sunday night staple
Miliband promises no stamp duty for first-time buyers as he pushes Tories on housing

Miliband promises no stamp duty for first-time buyers

Labour leader pushes Tories on housing
Aviation history is littered with grand failures - from the the Bristol Brabazon to Concorde - but what went wrong with the SuperJumbo?

Aviation history is littered with grand failures

But what went wrong with the SuperJumbo?
Fear of Putin, Islamists and immigration is giving rise to a new generation of Soviet-style 'iron curtains' right across Europe

Fortress Europe?

Fear of Putin, Islamists and immigration is giving rise to a new generation of 'iron curtains'
Never mind what you're wearing, it's what you're reclining on

Never mind what you're wearing

It's what you're reclining on that matters
General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband

Chuka Umunna: A virus of racism runs through Ukip

The shadow business secretary on the benefits of immigration, humility – and his leader Ed Miliband
Yemen crisis: This exotic war will soon become Europe's problem

Yemen's exotic war will soon affect Europe

Terrorism and boatloads of desperate migrants will be the outcome of the Saudi air campaign, says Patrick Cockburn
Marginal Streets project aims to document voters in the run-up to the General Election

Marginal Streets project documents voters

Independent photographers Joseph Fox and Orlando Gili are uploading two portraits of constituents to their website for each day of the campaign
Game of Thrones: Visit the real-life kingdom of Westeros to see where violent history ends and telly tourism begins

The real-life kingdom of Westeros

Is there something a little uncomfortable about Game of Thrones shooting in Northern Ireland?
How to survive a social-media mauling, by the tough women of Twitter

How to survive a Twitter mauling

Mary Beard, Caroline Criado-Perez, Louise Mensch, Bunny La Roche and Courtney Barrasford reveal how to trounce the trolls
Gallipoli centenary: At dawn, the young remember the young who perished in one of the First World War's bloodiest battles

At dawn, the young remember the young

A century ago, soldiers of the Empire – many no more than boys – spilt on to Gallipoli’s beaches. On this 100th Anzac Day, there are personal, poetic tributes to their sacrifice
Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves

Follow the money as never before

Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves, reports Rupert Cornwell
Samuel West interview: The actor and director on austerity, unionisation, and not mentioning his famous parents

Samuel West interview

The actor and director on austerity, unionisation, and not mentioning his famous parents
General Election 2015: Imagine if the leading political parties were fashion labels

Imagine if the leading political parties were fashion labels

Fashion editor, Alexander Fury, on what the leaders' appearances tell us about them
Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

The architect of the HeForShe movement and head of UN Women on the world's failure to combat domestic violence