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UPDATE 3-Pharmacies under scrutiny over US meningitis outbreak

* Lawmakers seek tighter regulation of compounding companies

* Outbreak has sickened 138 people in 11 states, killed 12

* Senator Brown to return contributions from NECC owners

(Updates with company closure, Sen. Brown, state action)

By Tim McLaughlin and Toni Clarke

BOSTON, Oct 10 (Reuters) - A Massachusetts specialist pharmacy linked to a company at the center of a major health scare closed temporarily on Wednesday and a state regulator clamped down on such operations in the wake of a meningitis outbreak that has claimed a dozen lives.

The Massachusetts Department of Public Health said Ameridose LLC, a compounding pharmacy which shares ownership with the New England Compounding Center (NECC) tied to the tainted steroid treatments, had temporarily closed.

Massachusetts, which regulated the companies involved, also said it would increase scrutiny of so-called compounding pharmacies, which produce custom-made medications for doctors, as calls grew for a nationwide crackdown.

Since the Sept. 25 recall of three lots of a steroid produced by NECC, 138 people have contracted meningitis and 12 have died, according to the latest tally from the U.S. Centers of Disease Control and officials in 11 states where the outbreak has spread.

Idaho reported the first case discovered in the western United States. The hardest hit state is Tennessee with 44 people sickened with the rare disease.

The number of cases has grown rapidly as health practitioners contacted some 13,000 people who received injections from a potentially tainted supply of steroid medication shipped to 23 states.

Officials have expressed concern that NECC and other compounding pharmacies may have violated laws that allow them to alter drugs based on the needs of individual patients rather than produce large batches of medication for sale. NECC shipped more than 17,000 vials of the steroid methylprednisolone acetate, used mainly for back pain.

In one week, the meningitis outbreak has developed into a major national health scare and threatens to become a scandal over what the company was doing and who was supposed to be regulating its activities.

Congress has come under pressure to close what critics see as a loophole in regulation that left the company linked to the tainted product largely exempt from federal regulation.

The U.S. Food and Drug Administration regulates only the ingredients and their suppliers, not the compounders, which are subject to a patchwork of state oversight.

"We urge Congress to give FDA (the Food and Drug Administration) the authority it needs to assure these kinds of outbreaks do not happen again," said an official of the U.S. Department of Health and Human Services, who declined to be identified because of ongoing investigations.

Leading members of Congress and outside critics have begun to ask why the FDA did not step in anyway.

"They dropped the ball. They either didn't follow up or have chosen to look the other way or they have chosen to put resources toward other things," said Dr. Michael Carome, a health expert with the advocacy group Public Citizen.

The FDA said in a statement that its "legal authority to regulate compounded drugs is complex and has been challenged vigorously by the compounding industry both in courts and Congress. FDA, along with everyone involved, is focused on determining the cause of this outbreak and preventing this kind of tragedy in the future."

Massachusetts officials said the state would require all compounding pharmacies to sign a statement saying they are complying with regulations on their work.

Massachusetts Senator Scott Brown, a Republican, said on Wednesday his re-election campaign would donate to charity the campaign contributions received from the owners of NECC.

"Sen. Brown supports a full and thorough investigation to determine responsibility for this tragedy and to ensure nothing like it ever happens again," the campaign said in a statement.

ANGER FROM FAMILIES

Some patients expressed anger that such a sensitive area as steroid medication was so lightly regulated.

George Cary, whose wife Lilian Cary is one of three people to die in Michigan, said on Tuesday that Americans have a strong belief in their medical and political system and the outbreak should be a wake-up call to the nation.

"We don't have expectations of a faulty regulatory medical system that allows these types of mistakes to be made," Cary told reporters on his front lawn after a memorial for his wife. "So perhaps the message is, wake up America."

In five states - Tennessee, Michigan, Maryland, Virginia, and Florida - the outbreak has claimed lives, with the latest victim a 70-year-old man in Florida.

Thousands of people received the injections to relieve back pain and other complaints and are at risk of infection.

Approximately 5 percent of patients treated with the suspect medication in Tennessee have contracted meningitis, said Dr. David Reagan, chief medical officer for the Tennessee Department of Health. The rate of infection overall is not known.

Meningitis is an infection of the membranes covering the brain and spinal cord. Symptoms include headache, fever and nausea. Fungal meningitis, unlike viral and bacterial meningitis, is not contagious.

Some of the thousands of people exposed may have to wait anxiously for weeks because the incubation period of the disease is up to a month, health experts said.

In Tennessee cases, officials said they had found the average incubation period to be 16 days, but they caution that it could range from six to 42 days for their patients.

Tennessee has been the hardest hit state, with six reported deaths and 44 cases of meningitis, followed by Michigan with three deaths and 28 cases, Virginia with one death and 27 cases and Maryland with one death and nine cases.

The other states with cases are Indiana (15), Florida (6), Minnesota (3), North Carolina (2), Ohio (1), New Jersey (2) and Idaho (1).

(Additional reporting by David Morgan, Susan Guyett and Meghana Keshavan; Writing by Greg McCune and Michele Gershberg; Editing by Lisa Shumaker and Claudia Parsons)

Keywords: USA HEALTH/MENINGITIS