The 14 people who died of fungal meningitis after they were injected with an apparently tainted steroid surely had no idea that their medication hadn't come from a regular pharmaceutical company that meets federal standards for safety and efficacy. Rather, it had been produced by one of the nation's "compounding pharmacies," which used to be small operations producing customized versions of drugs for people whose particular medical issues made it difficult for them to take standard medications. Because of their small, specialized operations, such businesses have been largely exempted from inspection and regulation by the U.S. Food and Drug Administration.
Yet many of them have grown into sizable manufacturers that make the same drugs produced by traditional pharmaceutical companies. The injectable steroid implicated in the meningitis cases, for example, was shipped to nearly two dozen states and used to treat up to 14,000 patients with back or neck pain. This has been possible in part because of provisions of the 1997 Food and Drug Administration Modernization Act, which allowed compounding pharmacies to avoid the levels of testing and other standards required of regular pharmaceutical firms. Court decisions further tied the FDA's hands.
Since then, these companies have operated in a legal limbo. They are supposed to come under the purview of state pharmacy boards, but those boards are ill-equipped to regulate such operations. The FDA is allowed to step in under some circumstances.