Japanese endoscope manufacturer Olympus Corp announced on Monday that it has dismissed Chief Executive Stefan Kaufmann following allegations of illegal drug purchases, causing its shares to plummet by 6 percent.
Kaufmann, a German national who assumed the role in April of the previous year, was appointed to enhance Olympus’ medical equipment division after his predecessor, Yasuo Takeuchi, guided the company through several years of asset divestitures. Takeuchi, 67, who is also an Olympus director, will temporarily resume CEO responsibilities, the company stated.
“In light of allegations regarding Mr. Stefan Kaufmann’s involvement in the purchase of illegal drugs, Olympus initiated an immediate investigation in consultation with external legal counsel,” the company said in its announcement. It refrained from disclosing the identity of the accuser or specifics about the investigation.
“Following the investigation’s findings, the Board of Directors unanimously concluded that Mr. Stefan Kaufmann likely participated in actions that contradict our global code of conduct, core values, and corporate culture.” Consequently, the board requested his resignation, which Kaufmann accepted, as indicated in the statement.
Reuters was unable to obtain comments from Kaufmann.
As reported by the Kyodo news agency, Olympus sought police advice regarding the situation. The police reportedly searched Kaufmann’s residence in June but did not discover any illegal drugs, according to an unnamed investigative source.
A representative from the Tokyo metropolitan police stated that this information had not been publicly released.
Kaufmann, 56, who has over two decades of experience at Olympus, took the helm shortly after the company received warning letters from the U.S. Food and Drug Administration concerning violations related to reporting requirements and quality system regulations for endoscopes and associated accessories.
His primary objectives included resolving those regulatory challenges and expanding the company’s core MedTech sector, as noted by an individual who has worked with him and spoke on the condition of anonymity.
Olympus has expressed interest in pursuing deals in digital technology and robotics after divesting its camera, voice recorder, and microscope divisions, Takeuchi mentioned in a joint interview with Kaufmann in November 2022.
Olympus experienced a 6 percent decline on Monday, setting the stage for its largest one-day drop in nearly three months. Since Kaufmann took over as CEO, the company’s stock has increased by 16 percent, which falls short of the Nikkei 225’s 38 percent rise. Olympus has faced its share of corporate controversies.
Thirteen years ago, its first foreign CEO, Michael Woodford, revealed accounting fraud linked to inflated acquisition costs to conceal losses.
Woodford was dismissed shortly after assuming the role and ultimately lost his fight for control of Olympus.
In 2015, American Julie Hamp, an executive at Toyota Motor, was arrested in Japan on charges of illegally importing the painkiller Oxycodone into the country. She was subsequently released.