The Global Times newspaper reported that Chinese Premier Li Keqiang has instructed authorities to dispatch teams to immediately investigate "the entire product chain" of all vaccines, vowing "severe punishment" and zero tolerance for anybody involved in the scandal.
Regulators said the large drugmaker, Changchun Changsheng Life Sciences Limited, had arbitrarily changed the way it makes freeze-dried human rabies vaccines, as well as falsifying records and inspection reports.
The case has gone viral in China, where sensitivity over food and drug safety is extremely high after a slew of scandals over the last decade. It was among the most hotly discussed topics on microblogging website Sina Weibo on Monday. "What will it be tomorrow?" another wrote, referring to a major scandal in 2008 when several infants died after the industrial chemical melamine was added to milk powder to raise its protein levels.
"The authorities need to release whatever information they know about the incident to the public as soon as possible", the article said.
Vials containing the vaccine for rabies are seen as a local market supervisory authority official conducts a check at a hospital in Rongan in China's southern Guangxi.
Changsheng, in a regulatory filing, said it does not expect its operations to be able to resume with in three months.
Changchun Changsheng Biotech, based in Jilin, is charged with having sold 252,600 vaccines to the Shandong Prevention and Control Center.
The Shenzhen-listed company risks being subject to delisting risk warning, trading suspension or delisting if regulators confirm any substantial illegal act or the investigation is transfered to the public security department, according to the announcement.
Changsheng's shares, which have lost 40 per cent since mid-July, were suspended on Monday.
The wider CSI 300 healthcare index was down about 5 percent.
Changsheng Biotechnology, the Chinese vaccine maker accused of falsifying data, plunged deeper into crisis on Tuesday as both police and the country's top graft watchdog launched investigations into the firm.
Details of the fake DPT vaccines sold by the same company last November emerged during investigations into the rabies vaccine, indicating that the matter was hushed up.
The controversy comes just over two years after police in northern Shandong province said they had uncovered the illegal sale of almost $90 million worth of vaccines.
It was recently discovered that a common blood pressure and heart drug manufactured in bulk by Chinese firm Zhejiang Huahai Pharmaceutical may have contained an impurity linked to cancer since 2012.
Concern has now shifted to the safety of the DTaP vaccine.
A snap investigation by the government revealed that one of the country's biggest vaccine makers, Changchun Changsheng Bio-technology, has been fabricating records for its rabies vaccine production.
The scandals have cast an ugly blight on China's public vaccination system, which has previously been credited with cutting the number of polio, hepatitis B and tetanus cases.
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