The ruined backpack is dropped by a zombie during the Zogre Flesh Eaters quest, in the caves of Jiggig. It contains items that players use to investigate Brentle Vahn's death. These items are a dragon inn tankard, rotten food and a knife. The tankard is the only item in the backpack that is required for the quest.
The backpack automatically disappears after the player clicks to check what is inside it.