After weeks of insisting that severe acute respiratory syndrome was under control, China this week said the health situation had become grave. The new lung disease, initially concentrated in urban Hong Kong and the neighboring Guangdong province, seems to be spreading to rural areas. At least 1,250 people in China have been diagnosed with the disease, dozens of them in inland China, and many more cases are suspected. About 4 percent of those diagnosed with SARS die from it. Treatment could be on the way, though, now that Canadian scientists this week cracked the genetic code of the virus, which they called a completely new coronavirus. The two known human coronaviruses are much less virulent; they are responsible for the common cold.