Critics say drug manufacturers have sidestepped costly and strict oversight by classifying themselves as pharmacies, which are given freer rein to mix drug compounds for patients.

"People are playing Russian roulette when they use one of these compounded drugs," said Sheldon Bradshaw, a Washington lawyer who was chief counsel for the Food and Drug Administration from 2005 to 2007.

"They don't have to follow good manufacturing practices which guarantee a product isn't going to be contaminated. They don't have to spend hundreds of millions on clinical trials to show their drugs are safe," he said.

Problems could be far more widespread than feared because, unlike manufacturers of FDA- approved drugs, pharmacies are not required to report adverse reactions or injuries. And many doctors don't realise the drugs they are prescribing are not produced at facilities with the FDA's seal of approval.

After a memorial for his wife Lillian, 67, in Michigan on Tuesday, widower George Cary said: "Our loss, and that of others, should be a wake-up call to our country. The apparent lack of suitable inspections should not have happened."

Lawmakers have already announced plans to introduce legislation to strengthen oversight, but others are asking the FDA for more immediate action.

"The recent outbreak of a dangerous, potentially deadly, disease indicates a clear and present need for stronger accountability and oversight," Senator Richard Blumenthal said in a letter to the FDA.

The looser regulations were intended to allow pharmacists to fulfil their traditional role of tailoring a drug to suit a particular patient - for example, by mixing a lower dose of medicine with flavoured syrup to make it suitable for a child - without having to deal with onerous requirements, such as clinical trials.

Yet they have created a "grey area in the law", allowing a growing number of companies to produce compounds on an industrial scale, said Kevin Outterson, a professor of health law at the Boston University School of Law.

"It's a classic gap in the regulatory structure, which companies have used to build this business over the past few decades," he said. As a result, the FDA has more power to regulate drug companies in China than large-scale compounding pharmacies in the US, he claimed.

State agencies regulate pharmacies, although the FDA steps in to investigate if a "significant violation" is reported.

The New England Compounding Centre, which distributed thousands of vials of the tainted steroids, has been investigated by the state of Massachusetts and the FDA at least twice in the past decade. It is not accredited by a professional board.

It is not clear how the drugs were contaminated or why the problem took so long to discover. Health officials are urging patients who received a dose as far back as May to see their doctor.

The New England Compounding Center has recalled all its products and ceased operations. The FDA declined to comment on whether an oversight failure or the loose regulation of pharmacy compounds contributed to the outbreak.

The International Academy of Compounding Pharmacists has met with lawmakers to discuss ways "to make sure this never happens again", said academy spokeswoman Dagmar Climo.

She declined to comment on whether the group believes large-scale producers of compounds need to be better regulated.