From the Super Mario Wiki, the Mario encyclopedia
Capsule blasters are special items in Dr. Mario World, able to be used in the middle of playing a stage in Stage Mode. When used, they eliminate all lingering capsules on the stage. The first use of them is handed them for free by Dr. Toad, while subsequent uses of them must be purchased via diamonds or won in certain events. They cost two diamonds to use, making them the cheapest option to the other special items.
As of version 1.4.0, this item is removed from the game, instead being replaced by the Capsule Swapper. If a player has any remaining Capsule blasters before updating to version 1.4.0, they will have the option to redeem that many Capsule Swappers from their inbox.