Pharmaceutical giant Bristol-Myers Squibb has said it may have to restate its results if regulators investigating its sales practices rule against it.

The inquiry, launched by the Securities and Exchange Commission in April, is focused on a promotional campaign aimed at encouraging drug wholesalers to build up excess stocks of Bristol-Myers products.

Bristol Myers, which earlier this year warned that stockpiling by wholesalers could weigh down its sales performance in 2002, said in a statement that the SEC's inquiry could become "a more formal investigation."

"One possible outcome could be a restatement of our results reflecting the previously undisclosed wholesaler inventory build-up," the company added.

It said a redraft of its financial statements was unlikely, and stressed that it was cooperating with the SEC.

Shares slide

But the announcement, which came one day after Bristol-Meyers' boss Peter Dolan complied with new rules obliging corporate chiefs to vouch personally for the accuracy of their firms' accounts, unnerved investors.

Bristol-Meyers shares were down seven percent at $21.90 in early afternoon trade in New York.

The company, which made a profit of $4.7bn on sales of $19.4bn last year, admitted that its sales promotions to wholesalers were under investigation in early July.

It is not yet clear when the SEC expects to wind up its inquiry.

Bristol-Myers did not say by how much it might have to restate its earnings, but pharmaceutical industry analysts have estimated that the sales campaign could have inflated its revenues by as much as $1bn.