Puerto Rico’s economy is built on manufacturing, and pharmaceuticals dominate the picture. The island produces everything from cancer drugs and HIV medications to rum, medical devices, and aerospace components. In 2024, pharmaceutical and medicine manufacturing was the largest export industry, and when combined with medical equipment, those two sectors alone accounted for roughly 88.3 percent of the territory’s total exports.
Pharmaceuticals and Biotechnology
Puerto Rico is one of the most important pharmaceutical manufacturing hubs in the world. Eleven of the top 20 global pharmaceutical companies operate facilities on the island, producing drugs that supply hospitals and pharmacies across the mainland United States and internationally.
The specific products coming off Puerto Rico’s production lines include oncology drugs (cancer treatments like anti-neoplastics and immunosuppressives), HIV medications, cardiovascular drugs, and antidepressants. The island is also a critical source of IV fluids such as saline solution, IV nutritional products, and blood fraction products. When Hurricane Maria disrupted production in 2017, hospitals on the U.S. mainland experienced serious shortages of basic IV bags, highlighting just how central Puerto Rico is to the domestic drug supply chain.
According to the Bureau of Labor Statistics, pharmaceutical and medicine manufacturing is the single largest export industry in Puerto Rico. The sector’s dominance is not just about volume. These are high-value, complex products that require specialized facilities and skilled workers, which is why major biotech and pharma companies have maintained operations on the island for decades.
Medical Devices and Equipment
Medical device manufacturing is Puerto Rico’s second-largest export industry, representing 6.5 percent of total exports in 2024. Factories on the island produce glucose monitors, cardiac pacemakers, and blood collection systems, among other products. The world’s leading medical device companies maintain a presence there, drawn by an established manufacturing workforce and proximity to the U.S. market without the need for customs clearance, since Puerto Rico is a U.S. territory.
Rum and Spirits
Puerto Rico has been synonymous with rum for centuries, and the industry remains an important part of the local economy. The island is home to several globally recognized brands. Bacardi operates one of the world’s largest premium rum distilleries in the municipality of Cataño, just across the bay from San Juan. Captain Morgan also produces a significant share of its rum on the island. These operations generate revenue not only through exports but also through excise tax rebates that the federal government returns to Puerto Rico’s treasury.
Rum production relies on sugarcane and molasses, tying the spirits industry to the island’s agricultural roots even as large-scale sugar farming has declined. Beyond the big-name distilleries, smaller craft producers have emerged in recent years, adding artisanal and aged rums to Puerto Rico’s output.
Aerospace Components
Puerto Rico has developed a growing aerospace manufacturing sector. Companies on the island produce precision-engineered parts and lightweight materials used in aircraft and space applications. Aguadilla, on the island’s northwest coast, serves as a hub for aerospace operations, with the Caribbean’s longest airport runway at 11,702 feet, which supports large-scale testing and logistics for aeronautical companies. Programs like LIFT Puerto Rico focus on developing advanced lightweight materials specifically for aerospace use.
Food, Agriculture, and Other Products
While manufacturing dominates exports, Puerto Rico still produces a range of agricultural goods for local consumption and some export. Coffee grown in the island’s mountainous interior is perhaps the best-known crop, with a reputation for high quality that dates back to the 19th century. Plantains, bananas, dairy products, and livestock round out the agricultural sector, though the island imports the vast majority of its food.
Puerto Rico also produces processed foods, chemicals, and electronics. The territory’s status as a U.S. jurisdiction with certain tax incentives has historically attracted companies looking for a manufacturing base that combines access to the American market with lower operating costs than the mainland.
Why Manufacturing Dominates
Puerto Rico’s economic profile looks quite different from a typical U.S. state. Manufacturing accounts for an outsized share of the island’s gross domestic product, driven largely by the pharmaceutical and medical device sectors. This concentration traces back to tax incentives that Congress introduced in the mid-20th century to encourage investment on the island. Although the most generous of those provisions expired in 2006, triggering a prolonged recession, the infrastructure, workforce expertise, and supply chains that companies built over decades have kept many operations in place.
The practical result is that Puerto Rico punches well above its weight in certain product categories. For drugs, medical devices, and rum, the island is not just a regional player but a globally significant producer whose output directly affects supply chains on the U.S. mainland and beyond.