Thousands of bottles of industrial bleach have been sold across New Zealand as a miracle cure for cancer and HIV, sparking a health warning.

Medsafe, a Health Ministry business unit, said consumers should immediately stop taking Miracle Mineral Solution, or MMS, which could cause "severe harm to health".

But the solution's distributors say its popularity has recently mushroomed in New Zealand because people have seen it work, and the warnings show that medicine is biased towards the pharmaceutical industry.

The solution, claimed to be effective against the flu, HIV and cancer, is based on chlorine dioxide, a well-known compound.

Medsafe warned the chemical was "a potent bleach used for stripping textiles and industrial water treatment".

It is also a recognised water purifier used as a substitute for chlorine in public water supplies, though it is rare in New Zealand due to cost. It is more frequently used here as a disinfectant in swimming pools.

Medsafe said high oral doses could cause nausea, vomiting, diarrhoea and symptoms of severe dehydration.

But Waikato distributor Roger Blake said he had sold hundreds of bottles for three years and had received no complaints of acute problems.

"Read Medsafe's list of symptoms and just ask: what would chemo do to you?"

There were probably more than 100 distributors in New Zealand, with sales picking up about 30 per cent every year. They had sold between 500 and 1000 bottles a year during the past three years, Mr Blake said.

"I have not had one email where someone has said 'this doesn't do what you claim', or 'I nearly died from doing this'."

Medsafe said it had followed an international precedent, including the United States Food and Drug Administration's lead, in issuing the warning.

The FDA issued its warning in July, and Medsafe has copied the wording of its United States counterpart to detail the issues, only replacing "an acid such as citrus juice" with "citric acid".

Medsafe is requiring distributors to stop claiming that their products are effective treatments for serious diseases.

Mr Blake now markets Miracle Mineral Solution as a water purifier, while the Bay of Plenty's Richard Tax says on his shop's website that it elevates immune defence, without using the words "treat" or "cure".

The product is categorised as a dietary supplement and does not require Ministry of Health approval to be sold.

Mr Tax said he had used the solution to treat colds and it worked a treat.

But medical researcher Professor Shaun Holt said: "You don't need to be a health professional to know it's not healthy to be taking in amounts of bleach."

The Ministry of Health has not yet replied after being asked if it carried out its own tests, but asks that any adverse effects be reported to the New Zealand Pharmacovigilance Centre for Adverse Reaction Monitoring at Otago University.