The police are investigating an Auckland-based organisation that claims it is conducting clinical trials of a drug known as Ease.
Stargate International says it is trying to find a safer, legal alternative to the class B drug, ecstasy.
But it has suspended the process after health officials said Ease contains a drug called methylone, which is very similar to class B drugs.
Associate Health Minister Jim Anderton says he's waiting for a legal opinion from the Crown Law office on the legitimacy of Stargate International's actions.
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Anderson says the police are looking into it.
Stargate International says it had assurances from government agencies that the substance was legal.
