One of my all time favorite asian based movies is Man Behind The Sun which is about Unit 731 which was a Japanese chemical/biological warfare research facility. I believe there is a subbed copy on youtube right now. It is based on true events. The movie is actually directed and created in Hong Kong, but it is about Japan. But as far as good Japanese made Horror films Suicide Circle was a really good one. As well as Ringu, Suicide Club.
Essence in the mist, that is the shadow with the grip.