The supplier of diluted chemotherapy to more than 1,000 cancer patients in Ontario and New Brunswick is operating in a regulatory grey zone.

"Marchese Hospital Solutions does not have a licence," as an accredited pharmacy, Lori DeCou, manager of communications for the Ontario College of Pharmacists, said Wednesday.

DeCou said the college, which regulates pharmacists in Ontario, is investigating the Mississauga, Ont., company that supplied premixed IV bags of chemotherapy to hospitals.

There also questions about federal jurisdiction regarding whether Marchese was operating as a drug manufacturer.

"We're looking into the activities that Marchese Hospital Solutions performs, and we're looking to see which activities of which part of this company actually falls under provincial versus federal jurisdiction," said Dr. Supriya Sharma, a senior medical advisor at Health Canada in Ottawa. "We're still in the process of finding that out."

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The discovery of the watered-down drugs in late March prompted Cancer Care Ontario to alert affected patients to consult their oncologists as quickly as possible. (CBC)

"This is a new way of doing business so we need to sort which activities are being done and then who has the overall oversight over them."

Drug manufacturers are required to have a licence from Health Canada and are subject to federal inspections, according to the regulator's website.

Health Canada's website defines the conditions for drug manufacturing.

Patients in the Ontario communities of Oshawa, Peterborough, London and Windsor, as well as Saint John, N.B., were given lower than intended doses of cyclophosphamide and gemcitabine. The chemotherapy is part of a regime for breast and lung cancer as well as lymphoma and leukemia.

Since Tracey Kaiman of London, Ont., was diagnosed with breast cancer in June, she's had two lumpectomies and was treated with chemotherapy at London Health Sciences Centre. She spoke to her oncologist on the weekend.

"My reaction was, 'I can't believe this happened to me'," Kaiman said from her dress shop in Woodstock, Ont. "They told me my chemo was watered down and that basically he thinks it may not affect me, but there are no guarantees."

Marchese has said the problem arose not from how the bags were prepared but in how they were administered at the hospitals.

Ontario Health Minister Deb Matthews dismissed the opposition NDP's call for an ombudsman investigation, saying she's appointed pharmacist Jake Thiessen to review the province's cancer drug supply.

"We've also got all partners at the table," Matthews told reporters. "Collectively there is clear responsibility to patients and as I say, I have no patience for jurisdictional squabbles. We need answers and I am going to make sure the College of Pharmacists gets the tools they need."

"We are in complete agreement that a real  investigation must take place that is already under way," Matthews said.

With files from CBC's Kelly Crowe and Melanie Glanz