Up to 500,000 toys are being recalled after concerns they contain a chemical that converts to a powerful "date rape" drug if ingested.

Character Group - the UK distributor of Bindeez beads has asked retailers and consumers across the UK and Ireland to return the products as China froze exports of the similar "Aqua Dots" product.

It follows reports that children in the US and Australia have been taken to hospital after swallowing the beads.

They can be arranged into designs and fused together when sprayed with water but scientists have said a chemical coating on the beads, when ingested, metabolises into the gamma hydroxy butyrate (GHB).

Character Group said it believes an "unapproved formulation" might have been used in the manufacturing process.

The firm said there have been no cases of illness reported in the UK and Ireland, but said the voluntary recall was issued as a precautionary measure.

Character has shipped up to 500,000 Bindeez bead products over the year, with between 100,000 to 150,000 with retailers at the moment.

Shares in Character Group plummeted 8 per cent on the news, as it warned the situation would "inevitably" hit sales in the key pre-Christmas trading period.

Richard King, chairman of Character Group, said: "We believe that the product we have is safe, but it's going to be some time until we get results of the toxicology test reports and rather than take a chance, safety is of prime importance and therefore we have taken this precaution."

Replacement products will be sent to all consumers and retailers affected by the recall, with the new supplies available from the first week of December.

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