In a large heavy saucepan, combine the milk, sugar, vanilla bean and seeds and bring to a gentle simmer over medium heat, stirring to dissolve the sugar. When the milk begins to get foamy on top, stir to incorporate the foam.
In a small bowl, dissolve the baking soda in the water, and add to the milk mixture. Reduce the heat to low and cook uncovered at a bare simmer. Let cook, stirring occasionally without working the foam into the milk. After 1 hour remove the vanilla bean. Continue cooking, skimming occasionally, until tan, very thick, and reduced to about 1 cup, 1 1/2 to 2 hours. (The milk will continue to darken as it cooks.)
Strain into a clean container and let cool. Cover and refrigerate until ready to use. (The dulce de leche will thicken as it cools, and will keep refrigerated for up to 2 weeks.)
Yield: about 1 cup