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Megatron's "crimson fog" is a transmitter, possibly a variant of the Predacon shell program that causes a gradual buildup of irritation in Transformers that magnifies disharmony, eventually resulting in hostile behavior up to and including attempted murder.
The weapon is launched as a parachute-arrested gravity package from a floating platform, and can be programmed to home in on a transmitter during the descent.
A Meeting of Minds
Megatron sends Quickstrike (then awaiting trial) to plant the "crimson fog" in a strategic location near the Ark, hoping the Maximals will destroy one another. Though initially successful, the experience of beating on his fellow Maximals awakens recent unpleasant memories for Optimus Primal, who is able to break free of its control.
The weapon is not named. Megatron's internal monologue refers to it by the flowery term "crimson fog". The name 'crimson fog' is almost certainly a play on the phrase 'red mist,' a rage which clouds one's judgment. The visual metaphor of the Hate Plague was probably based on this same phrase.
Optimus Primal speculated the "crimson fog" is based on the Predacon shell program; this is pure speculation on his part, but it is presumed to be correct. Megatron later used the Hate Plague itself against the Maximals, but that sample was still transmitted by touch, so it seems unlikely that the crimson fog is related.
The weapon's means of deployment is (incidentally) similar to Sonic Scrambler Mines.