Compounding pharmacies serve a critical role in modern health care to meet special patient care needs. Although the US Food and Drug Administration (FDA) has clearly delineated jurisdiction over drug companies and products manufactured under Good Manufacturing Practice (GMP) regulations to ensure quality, potency, and purity, compounding pharmacies are regulated by the State Boards and are not registered by the FDA. In recent years, some compounding pharmacies acted like a manufacturer, preparing large amounts of injectable drugs with interstate activities. Multiple outbreaks have been linked to compounding pharmacies, including a recent outbreak of fungal meningitis related to contaminated methylprednisolone, exposing > 14,000 patients in multiple states. This tragedy underscores the urgency of addressing safety related to compounding pharmacies. There is a call for action at the federal and state levels to set minimum production standards, impose new labeling conditions on compounded drugs, and require large-scale compounders be regulated by the FDA. “Industrial” compounding must come under FDA oversight, require those pharmacies to meet GMP standards, and ensure quality and safe products for patient use. Moreover, compliance with the Institute for Safe Medication Practices 2011 recommendations that any type of sterile compounding must be in compliance with the United States Pharmacopoeia chapter 797 guidelines will reduce the risk of patient harm from microbial contamination. Finally, other critical factors that require close attention include addressing injectable products compounded in hospitals and other outpatient health-care centers. The FDA and State Boards of Pharmacy must be adequately funded to exercise the oversight effectively.