• Churchill Downs Racetrack suspended horse trainer Bob Baffert for two years after attorneys said Kentucky Derby winner Medina Spirit had failed a second drug test for a banned steroid.
• The suspension means that no horse trained by Baffert or by Bob Baffert Racing Stables can race at any track owned by Churchill Downs Inc. through the conclusion of the 2023 Spring Meet at Churchill Downs.
• That meet includes the Kentucky Derby, the first jewel in thoroughbred horse racing's Triple Crown.

The company that operates Churchill Downs Racetrack on Wednesday suspended horse trainer Bob Baffert for two years, just hours after attorneys revealed that his Kentucky Derby winner Medina Spirit had failed a second drug test for the banned steroid betamethasone.

The suspension means that no horse trained by him or by Bob Baffert Racing Stables can race at any track owned by Churchill Downs Inc. through the conclusion of the 2023 Spring Meet at Churchill Downs.

That meet includes the Kentucky Derby, the first jewel in thoroughbred horse racing's Triple Crown.

Kentucky Horse Racing Commission officials have yet to rule on whether to overturn Medina Spirit's victory in the Derby because of the two failed tests.

Baffert was temporarily suspended in mid-May by New York racing officials, effectively blocking Medina Spirit or other Baffert horses from racing Saturday on Long Island in the Belmont Stakes, the last leg of the Triple Crown.

Bill Carstanjen, CEO of Churchill Downs, cited Baffert's prior history of failed drug tests by horses in announcing the two-year ban on the trainer, whose seven Derby wins are the most of any trainer.

Baffert has had five horses fail drug tests this year alone.

Carstanjen also took a shot a Baffert for floating the idea that Medina Spirit only had betamethasone in its system because of an antifungal ointment that was applied to the horse.

"CDI has consistently advocated for strict medication regulations so that we can confidently ensure that horses are fit to race and the races are conducted fairly," Carstanjen said in a statement.

"Reckless practices and substance violations that jeopardize the safety of our equine and human athletes or compromise the integrity of our sport are not acceptable and as a company we must take measures to demonstrate that they will not be tolerated," Carstanjen said.

"Mr. Baffert's record of testing failures threatens public confidence in thoroughbred racing and the reputation of the Kentucky Derby," the CEO said.

"Given these repeated failures over the last year, including the increasingly extraordinary explanations, we firmly believe that asserting our rights to impose these measures is our duty and responsibility." 

Churchill Downs Inc. said it reserved the right to extend Baffert's suspension "if there are additional violations in any racing jurisdiction."

Baffert on May 9 revealed that Medina Spirit had tested positive for betamethasone, a steroid used for therapeutic purposes in horses, in a sample taken the day of its Derby win a week earlier. Baffert said 21 picograms of the drug were found in the sample.

The drug, typically used to treat pain and swelling in a horse's joints, is legal for use in Kentucky.

But any trace of it on race day in the state is grounds for disqualification if a second test confirms it was in the blood on that day.

On Wednesday, lawyers for Medina Spirit's owner, Amr Zedan, and Baffert announced that the second test of a blood sample had also found betamethasone.

Clark Brewster, the attorney for the Zedan, told CNBC that officials are allowing the Medina Spirit team to have another lab analyze a third sample from the horse.

That test, Brewster said, could determine whether there are chemicals that would support Baffert's claim that the betamethasone may have come from a topical ointment known as Otomax, and not from an injection.

Brewster noted that picogram is just a trillionth of a gram.

"Hopefully they will make a reasonable judgment," Brewster said, referring to the review of the drug test results by the Kentucky Horse Racing Commission.

"I think there will be unanimity on the subject that this is an infinitesimal amount that could not have affected the race," the lawyer said.

Marty Irby, executive director of the advocacy group Animal Wellness Action, in a statement, said that Baffert's suspension by Churchill Down was a "swift and meaningful action ... but the penalty falls short of seeing justice and that track as well as others around the nation should consider a greater penalty for the trainer."

"He's sneered at weak penalties for doping violations again and again," Irby said. "Baffert will only get the message with a long-term suspension from the sport.

"On the upside, it is comforting to know that Baffert will not be allowed to compete at the Kentucky Derby until after the Horseracing Integrity and Safety Act - that bans race day doping in the sport - has been implemented and taken full effect." 

Maryland racing officials in May allowed Medina Spirit and another Baffert-trained horse, Concert Tour, to enter the Preakness Stakes in Baltimore after getting what they called "a binding commitment" from Baffert for "full transparency of medical and testing results that will allow for all results to be released to the public."

Medina Spirit finished third in the Preakness, the second leg of the Triple Crown, trailing behind the winner, Rombauer, and Midnight Bourbon. Concert Tour finished ninth.

Disclosure: CNBC parent NBCUniversal owns NBC and NBC Sports, which broadcast the Triple Crown races.