The firm's steroid injections, tainted with a fungus, have been blamed for the meningitis deaths.
"The FDA has fostered a weak regulatory environment and encouraged pharmacies in the false belief that they are somehow exempt from the laws set in place to ensure the quality of our nation's drug supply," Public Citizen wrote to agency chief Margaret Hamburg on Thursday.
"Unless the FDA takes swift and decisive action, more avoidable patient injuries are virtually guaranteed."
Drug compounders customize medications for patients with special needs. Most operate on a small scale, but some firms have taken advantage of regulatory ambiguity to mass-produce drugs that do not meet FDA safety standards.
The meningitis outbreak has prompted calls for Congress to clarify the FDA's authority over drug compounders, which it shares with state regulators.
In a recent congressional hearing, Hamburg said that her hands are tied by conflicting court decisions that complicate the agency's enforcement actions.
Public Citizen argued Thursday that while additional laws could strengthen and clarify the FDA's role, the agency should take a heavier hand with pharmacies that "flaunt the existing laws."
The advocacy group counted "at least 18 warning letters against 16 different pharmacy compounding companies" and said that five of the letters identified patient injuries or deaths allegedly linked to the firms' products.
"We are contacting you to urge that the FDA either promptly re-inspect each of these facilities or verify that there has been a recent re-inspection documenting that serious safety concerns uncovered in earlier inspections have been corrected," Public Citizen wrote.