The European Commission has launched a research project to combat what may be the continent's most dangerous source of pollution, the accidental release of 5,000 tonnes of biologically active chemicals into the environment each year.
The project was designed to look at human and animal medicines that find their way into soil and water, including drinking water, as waste products.
It forms part of the commission's Framework 6 programme for research, building on work carried out under Framework 5.
Alistair Boxall, director of Cranfield University's Centre for Ecochemistry and leader of FP5 research on veterinary medicines, said his group, involving five institutions in the UK, Spain, Denmark and the Netherlands, spent e1.3 million (£900,000) over three years looking at farm chemicals in water and soil.
They had discovered damaging effects on fish, insects, crops, aquatic plants, worms and soil microbes.
Dr Boxall said: "We have found that pharmaceutical residues such as those put on the land in slurry every year by farmers slow the growth of aquatic plants and affect soil bacteria by altering their enzyme processes and reducing their growth."
Dr Boxall's group studied the release of the three biggest agricultural chemicals in a variety of environments across Europe and found that the problem was similar in each country: once in the soil, chemicals could stay there for a year or more.
He said: "The effects of these chemicals are very similar to the effects of herbicides. And there are probably other effects building up over time that have yet to be observed."
The commission was alarmed about the release of active veterinary drugs into the environment because of fears that bacteria could develop resistance to antibiotics.
This resistance could be transmitted to bacteria present in the human body.
Dr Boxall said: "At the moment most of the attention is concentrated on antibiotic resistance appearing in hospitals. But we have seen some resistance in soil bacteria and we are using gene probes to find out which genes are responsible.
"Human health could be affected because drinking water supplies come from groundwater. We could see bugs in the human gut become resistant to pharmaceuticals. Very little research has been done on the environment as a transmitter of resistance to humans.
"Farmers find these drugs too effective to stop using them, so the answer will be to devise ways to keep these chemicals out of watercourses and drinking water," he added.
The next phase of the research will also look for ways of removing pharmaceuticals originally intended for humans from drinking water.
Thomas Ternes, a chemist at the German government's Federal Institute of Hydrology, told a European Commission meeting in Gothenburg, Sweden last week that hospitals and homes were both major sources of drugs in drinking water.
Dr Ternes said it might be possible to remove these chemicals by treating water with ozone. Applying this standard treatment for waste water and heavily polluted industrial effluent to supposedly clean drinking water would be a radical step.
Modern medical and farming practices have made the problem worse because they use pharmaceuticals in such large amounts.
Nicklas Paxeus, a chemist at Gryaab, the Gothenburg water treatment plant, warned that many families across Europe and the US bought drugs to treat anthrax during scares after the September 11 2001 attacks.
There would be a severe water pollution hazard if they now decided the risk had receded and the drugs could be flushed away, he added.