** RETRANSMISSION TO CHANGE OBJECT NAME ** In this photo released by China's Xihua News Agency, two babies with kidney stones receive medical treatment under the care of their fathers at a military hospital in Lanzhou, capital of northwest China's Gansu Province Thursday, Sept. 11, 2008. So far this year, Gansu Provincial Health Department has seen 59 kidney stone cases in infants, and at least one baby died as a result of kidney stones. (AP Photo/Xinhua, Zhu Guoliang)
BEIJING - China's Health Ministry warned Tuesday of a possible rise in the number of babies sickened by contaminated milk powder, which has already been linked to the deaths of two infants and illnesses in more than 1,200 others.
The official Xinhua News Agency quoted the ministry as saying medical agencies were prepared for a "possibly rising" number of cases, with China setting up a "multi-level treatment system" for affected infants.
The company at the heart of the widening food scandal, Sanlu Group Co., apologized for the tainted milk powder, which the Health Ministry has said was spiked with the industrial chemical melamine.
The company said suppliers who sold the raw milk apparently added the chemical, normally used in plastics, to make the milk seem higher in protein.
Zhang Zhenling, Sanlu's vice president, apologized Monday but did not explain why the company took so long to inform the public about the contamination despite receiving complaints as early as March and having tests confirm the presence of the chemical in early August.
The company went public with the information after its New Zealand stakeholder told the New Zealand government, which then informed the Chinese government.
"The serious safety accident of the Sanlu formula milk powder for infants has caused severe harm to many sickened babies and their families. We feel really sad about this," Zhang said, reading from a prepared statement.
Chinese health officials said 1,200 infants have been sickened by the tainted milk powder and police announced the arrests of two milk suppliers.
On Monday, the Health Ministry said a second infant from Gansu province had died of kidney failure after drinking the milk.
Vice Health Minister Ma Xiaowei told reporters that 1,253 infants had been sickened — mainly after developing kidney stones — more than twice the number previously acknowledged. Of those, 913 of the infants were only slightly affected, while 340 remained hospitalized and 53 cases were considered especially severe, he said.
It is the second crisis to raise questions about government accountability in China since the Beijing Olympics ended Aug. 24. At least 254 people died last week when a retaining wall of a waste dump at an illegal mine in northern China collapsed. The Shanxi provincial governor resigned and his deputy fired.
Police said they have arrested two brothers, surnamed Geng, who ran a milk collection center in Hebei province and are accused of adding melamine, Xinhua said. They sold about three tons of contaminated milk a day, the report said, citing Hebei police spokesman Shi Guizhong.
The incident is an embarrassing failure for China's product safety system, which was overhauled in an attempt to restore consumer confidence and preserve export markets after a string of recalls and warnings abroad over tainted toothpaste, faulty tires and other goods.
It is also the second major case in recent years involving baby formula. In 2004, more than 200 Chinese infants suffered malnutrition and at least 12 died after being fed phony formula that contained no nutrients.
The discovery of the tainted milk is especially damaging because Sanlu Group Co. is China's biggest producer of powdered milk and such large companies are expected to act as industry role models for safety and quality.
Shoddy and fake goods are common in China, and infants, hospital patients and others have been killed or injured by tainted or fake milk, medicines, liquor and other products.
Chinese investigators said melamine may have been added to fool quality tests after water was added to fraudulently increase the milk's volume. Standard tests for protein in food ingredients measure nitrogen levels.
None of the milk powder was exported to Europe or the United States, although Sanlu is 43 percent owned by a New Zealand dairy farmers' cooperative, Fonterra.
New Zealand Prime Minister Helen Clark said Monday she learned of the problem Sept. 5 and convened a meeting of senior ministers three days later at which she ordered officials to directly inform senior authorities in Beijing.
"We were the whistle blowers and they leapt in and ensured there was action on the ground," Clark told reporters. "At a local level ... I think the first inclination was to try and put a towel over it and deal with it without an official recall."
Fonterra, the world's biggest milk trader, says it urged Sanlu to recall the product as early as Aug. 2. Sanlu did not order a recall until last Thursday, after the New Zealand government told China.
Chinese officials have defended their response but blamed Sanlu Group for delays in warning the public. Officials say they were not alerted until last Monday.
Details of the children's deaths show the problem appeared to have gone undetected for months. The first victim, a five-month-old boy from the western city of Lanzhou, died May 1, ministry officials said. The second, an eight-month-old girl also from Lanzhou, died July 22.
China's quality watchdog, the General Administration for Quality Supervision, Inspection and Quarantine, has sent officials to Hebei, Guangdong and Heilongjiang provinces and the Inner Mongolia region to inspect dairy companies.
Inspectors will check the country's 175 baby milk food factories and their findings are expected within the next several days, Li said.