Stefan Kaufmann became chief executive officer in April 2023, having served as a board member since 2019. He first joined the European arm of Olympus in 2003.

Olympus shares plunged 6% in morning trade as the company apologised in a statement “for the concern this has caused to our shareholders, customers and all stakeholders.”

“Upon receiving an allegation that Mr Stefan Kaufmann had purchased illegal drugs, Olympus, in consultation with outside legal counsel, immediately investigated the facts, made a report to the investigative authorities, and cooperated fully with their investigation,” it said.

The company’s board of directors then “unanimously determined” that Kaufmann “likely engaged in behaviours that were inconsistent with our global code of conduct.”

Kaufmann, who is reportedly the company’s second non-Japanese president, was asked to offer his resignation which the board then accepted, Olympus added.

Olympus said in 2020 it was selling its struggling camera division to focus on medical equipment. It had been in the camera business since 1936, but struggled along with industry rivals after the advent of smartphones.

The storied company has seen success in the medical equipment field, and controls much of the global endoscope market.

Olympus chairman Yasuo Takeuchi will stand in as CEO “for the time being” while the board’s nominating committee considers “all options for a successor,” the company said.