How can we recommend this ointment and tell moms not to wash it off when
all or at least some of the ingredients say for external use only.

One of the arguments I used for switching to Lansinoh instead of Bag
Balm, anhydrous lanolin, etc. was the LLLI letter detailing the low
pesticide, detergent and alcohol levels which allegedly makes it safe to
use where small amounts of ingestion may occur.  Another argument is
that lanolin is of animal origin rather than having a petrolatum base,
as I assume is the base for all the ointments in your formula.

Just trying to anticipate the inevitable questions if I were to discuss
this recommendation with physicians or pharmacists.

Bonnie Jones, RN, ICCE, IBCLC
from the sunny S.W. USA