The sector is booming, but it’s a costly boom. In the sluggish US economy, the goods-producing sector has been in decline since late 2014, but sales in its biggest sub-sector are booming: medicines.
Drugs are a physically small part of the goods-producing economy. But in terms of dollars, they’re the elephant in the room: According to the wholesales report by the Commerce Department, total drug sales by manufacturers to pharmacies, hospitals, and others in the distribution chain jumped 11.3% from a year ago (not seasonally adjusted) to $54.3 billion.
That was the largest of the wholesale categories in the report: larger than ‘Groceries’ ($51.5 billion), ‘Electrical’ ($45.0 billion),’Petroleum’ ($43.4 billion), and Automotive ($36 billion). Drug sales accounted for 12.2% of total wholesales. For the last 12 months, it was 12.0%.
This post was published at Wolf Street by Wolf Richter ‘ July 15, 2016.