Organic farmers have approved antibiotics they can use (as well as natural remedies). If a dairy cow is treated with antibiotics the holding time before she is allowed back into the milking process is usually double or triple the normal holding time for a non-organic cow (10-15 days vs 5 days). Sh is still milked but the milk is poured away.
It would have to be a non-food application, if we are trying to isolate the antibiotics. The only non-food application of milk that I am aware of is casein plastics.
I think 'wasting' it is good. Once you find something useful for it, it perverts the incentives. A sick cow should be considered a complete waste with no benefit.
