China's food safety watchdog on Wednesday explained that its earlier announcement that batches of knockoff baby formula powder met food safety standards aimed to prevent public panic.

In an announcement on Monday, the China Food and Drug Administration (CFDA) admitted to finding generic infant formula sold as name-brand formula but noted that the fake formula met relevant food safety standards. Then on Wednesday, the CFDA explained that the purpose of their Monday announcement was to avoid too much panic among consumers who had already bought the fake formula. 

Manufacturing and selling knockoff formula constitutes intellectual property rights infringement and commercial fraud, and fake formula will be confiscated and destroyed regardless of whether or not it threatens public health and has passed qualification inspection, the CFDA said on its website.

Referring to the counterfeit formula case involving US brand Similac and domestic brand Beingmate recently solved by Shanghai police, the CFDA said the suspects in the case repackaged cheap infant formula they purchased independently and then sold it as popular name-brand formula.

Wednesday's announcement has caused more concern than relief among consumers, as many asked on social media whether more such cases have yet to be revealed.

Beingmate said Wednesday that its own inspection has not uncovered any suspicious products and added that the company will cooperate with further investigation by authorities.

The CFDA encourages consumers to demand compensation from producers of fake products, while the State Council has urged local authorities to track down the fake infant formula in provinces including East China's Anhui Province and Central China's Henan and Hubei provinces.

Shanghai police arrested six suspects in January for manufacturing counterfeit tins and labels of some popular brands of infant formula and then repacking poor quality formula in those faked tins and selling them for a higher price. The gang sold 17,000 tins of fake formula across the country, earning 2 million yuan ($300,000), the Mirror reported.