Anhui province died of malnutrition after drinking milk powder that had little to no nutrition . The illegally manufactured milk was falsely labeled with the Sanlu brand , according to the paper . More than 170 other babies were hospitalized as a result of drinking the cheap milk powder . Chinese police have questioned 78 people -- including dairy farmers and milk dealers -- about the most recent contamination , a Chinese official told Xinhua Saturday . Sanlu would not say whether its employees are being investigated , Xinhua said . Testing by Sanlu found tripolycyanamide , also known as melamine , in 700 tons of its product , said Zhao Xinchao , the vice mayor of Shijiazhuang , the news agency reported . Zhao told the news agency that the suspects added water to the milk they sold to Sanlu to make more money , then added the chemical so the diluted milk could still meet standards . Inspectors found the chemical in Sanlu infant formula produced by one of the company 's partner producers in northwest Gansu Province , an official said Sunday . Two of 12 samples randomly selected from the Sanlu milk powder produced by the
BEIJING , China -LRB- CNN -RRB- -- Officials on Monday announced the death of a second child who consumed contaminated milk powder . More than 1,200 others have been sickened , according to China 's Health Ministry . Of that number , 340 infants are hospitalized and 53 are considered to be in serious condition . Government inspectors are testing baby formula around China and plan to release their results on Tuesday , said Li Changjiang , head of the State Administration of Quality Supervision , Inspection and Quarantine , according to the Xinhua news agency . The manufacturer , Sanlu Group , has recalled more than 8,200 tons of the tainted formula following reports of babies developing kidney stones , Xinhua said . Watch what Sanlu has done '' Sanlu , one of China 's leading dairy producers , has also sealed off more than 2,100 tons of contaminated product , and another 700 tons still need to be recalled , the news agency said . It is not the first time Sanlu has been connected to a scandal involving tainted milk powder , according to China Daily . In 2004 , at least 13 infants in the eastern