Pill tests by KnowYourStuffNZ on Saturday uncovered a mystery drug containing "C86", an unknown cathinone.
The community organisation, which works in collaboration with the New Zealand Drug Foundation, tested pills in Dunedin and found the cathinone.
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It comes after testers found one in five drugs were not what the person thought they were during University of Otago's orientation week in February, the Otago Daily Times reports.
"Two samples of white in clear capsules from different sources were tested and each contained this single substance," a statement from KnowYourStuffNZ said.
The substance had previously been seen in the North Island.
"C86 is a stimulant from the cathinone family, also called 'bath salts", the statement said.
The drug may produce short-lived euphoria, followed by a long period of overstimulation, including a racing heart, high blood pressure, anxiety, overheating, and inability to sleep for up to 36 hours.
Cathinones have been associated with deaths overseas and hospitalisations in New Zealand, the statement said.
"Because of the high redose compulsion and low active dose, it is very easy to overdose."
KnowYourStuffNZ managing director Wendy Allison told Newshub the substance is so new it hadn't yet been identified.
"We can't say exactly what it is, we have confirmed that it's a cathinone but that's the best that we can say.
"There are health risks associated with cathinones - cathinones are generally in the stimulant class of substances.
"Without knowing what the substance is we can only give general information."
KnowYourStuff urges anyone who thinks they may have consumed a cathinone and is concerned, to contact their nearest medical service.