First off DO NOT SAND PAPER IT! You'll just end up ruining the finish and loosing the pattern.
Second DO NOT RE-ETCH IT! You can't properly reetch the blade and get a consistent look with ketchup. Don't try - you'll just ruin the blade.
Finally, what you CAN do - Start by wiping it down with plain old Windex. High in ammonia it will neutralize the acids eating at the metal.
Next take a good rough cloth (not scratchy, sort of a wash cloth or shop towel) spray it down with WD-40 and wipe the blade down. Pay particular attention to the damaged areas. The WD-40 will neutralize the ammonia in the Windex and the strippers in the oil will help remove the remaining stain.
If the stain remains, then you'll need to step up to something stronger such as Flitz. I recommend this only as a last resort. Flitz is a powerful chemical product which includes an abrasive - IT CAN AND WILL REMOVE SOME MATERIAL - use it sparingly and only in the areas where the damage remains.
If Flitz doesn't do the job I recommend you return it to either the maker or the owner (whichever you're working for) and let them handle the repair.
On the flip side - you need to figure out what happened to your leather sheath and what it's contaminated with before you go putting that sword back in it.