This is like poison to Vampires, and it comes from, obviously, Dead people. This is an essential tool when hunting vampires. A hunter could kill a vampire without this, but it creates enough pain to incapacitate a vampire. It first appears in its self titled episode, "Dead Man's Blood".
Use
Once in the vampire's system they can no longer move and lose all their strength. It also hurts them, which is why Gordon uses it to tortureLenore.
Although, Dead Man's Blood does wear off, and the vampire will be able to regain his or her strength. So far, there is only one known vampire able to still move after being injected with it: the Alpha Vampire, there father of and strongest vampire in existence.