News magazine Der Spiegel this week reported that a who's who of big German, Swiss and US pharmaceutical companies made deals with the dictatorship to test medicines, sometimes without the knowledge of the patients.
Several people were known to have died during trials, and some tests involved infants and delirious alcoholics, said the report on the agreements with the police state that collapsed with the 1989 fall of the Berlin Wall.
Major drugs companies, some of which have taken over other firms in corporate mergers since, insist they stuck to the standards and laws of the times. But calls have grown for full transparency into the agreements overseen by the State Security (Stasi) secret police to earn the communist state tens of millions in hard-currency.
"It was a nasty German-German deal" in which profits were made on both sides of the Berlin Wall, Stasi Archives Commissioner Roland Jahn, who was a dissident-journalist in the former German Democratic Republic (GDR), told Die Zeit weekly on Thursday.
"I am not surprised that medical tests were carried out in the GDR that didn't meet the standards of democratic countries. The dictatorship was capable of a lot."
A senior member of the opposition Greens party Volker Beck this week demanded a full investigation into what he called "the systematic circumvention of ethical and legal standards in drug trials by pharmaceutical companies in the GDR".
Health Minister Daniel Bahr urged drugs companies to financially support an inquiry, while the Berlin Charite hospital announced it would search its archives to bring clarity.
The commissioner for questions on the former East Germany, Christoph Bergner, on Wednesday said he had "promised financial support" to the Charite project, without mentioning amounts or details.
The report in Der Spiegel said some 600 clinical trials, including for blood pressure and depression drugs, were carried out in more than 50 hospitals, according to previously unpublished documents of the East German Health Ministry, pharmaceutical institute and Stasi.
The German drug industry's Association of Research-Based Pharmaceutical Companies in a statement said the tests met the common standards of the time.
"GDR law had requirements for the conduct of clinical studies that were comparable to those of Western countries including the United States," said its chief executive Birgit Fischer.
Several major drugs companies contacted by AFP said they would support an inquiry.
Germany's Bayer said it always applies equal standards in its medical trials worldwide, and that it presumed the GDR had followed its own laws at the time.
A Novartis spokesman said the Swiss group was open to cooperating with an independent research group, provided the transfer of sensitive patient data to third parties complies with legal standards.
And a Roche spokesman said the company was completely committed to applying rules and guidelines but pointed out that the "state of knowledge" had changed in the past 30 years.
Critics charge that, even if strict guidelines exist on paper, carrying out drug trials in police states or poor countries means rules may not be enforced, and that even patients informed about the risks may have little choice but to consent.
Jahn told Die Zeit that "I am not aware that during GDR times anyone looked into whether the tests complied with the rules."
"The State Security was tasked with covering up the drug tests. They were meant to secure the hard-currency deals and prevent disruptions, and for that they set up a spying system. We know that much from the files."
For East Germany, the millions in profits aimed to "preserve the power" of the regime and "to get the ramshackle health system going," he said.
For victims groups who suffered under the communist regime, the report revived some bitter memories.
Rainer Wagner, chairman of the Union of Groups of Victims of Communist Tyranny, said it showed how "leaders of the criminal state the GDR were chasing Western cash and therefore knew no moral scruples."