Puerto Rico is one of the world’s leading producers of pharmaceuticals and medical devices, but its economy stretches well beyond that. The island manufactures everything from pacemakers to rum, grows coffee in its central mountains, and exports billions of dollars in goods each year. Here’s a closer look at what Puerto Rico actually produces.
Pharmaceuticals: The Island’s Biggest Export
Puerto Rico is a pharmaceutical powerhouse. In 2024, the island ranked second in the entire United States for pharmaceutical and medicine manufacturing exports, accounting for 17.6 percent of the total U.S. trade dollar value in that category (behind only Indiana). That means roughly one in every six dollars’ worth of pharmaceutical exports leaving the country comes from Puerto Rico.
The island produces a wide range of medications, including biologics, which saw a 4.4 percent price increase over 12 months in 2024. Major global drug companies operate manufacturing plants on the island, drawn by tax incentives and a skilled local workforce trained in the strict quality standards the industry demands. For decades, Puerto Rico has been a go-to location for producing both brand-name and specialty drugs destined for the U.S. mainland and international markets.
Medical Devices
Pharmaceuticals get most of the attention, but Puerto Rico’s medical device sector is massive in its own right. Factories on the island produce pacemakers, insulin pumps, glucose monitors, blood collection systems, hernia patch implants, contact lenses, stents, and bandages. These aren’t small operations. Companies like Abbott, Baxter, Becton Dickinson, Medtronic, Stryker, and Zimmer-Biomet all have facilities in Puerto Rico.
Together, pharmaceuticals and medical devices make manufacturing the dominant sector of Puerto Rico’s economy by a wide margin. The combination of these two industries gives the island an outsized role in keeping hospitals and pharmacies across the mainland stocked, a fact that became painfully visible when Hurricane Maria disrupted production in 2017 and caused shortages of IV bags and certain medications nationwide.
Rum
Puerto Rico has been producing rum for centuries, and the island remains one of the largest rum-producing regions in the world. Bacardi, the world’s best-known rum brand, operates its largest distillery in Cataño, just across the bay from San Juan. Destilería Serrallés, maker of Don Q rum, has been distilling near Ponce since the 19th century, adjacent to the Serrallés family’s sugarcane fields. Puerto Rico Distillers, based in Arecibo, has operated since the late 1800s as well.
Rum production on the island generates significant tax revenue. Under a longstanding arrangement with the U.S. federal government, most of the federal excise taxes collected on rum produced in Puerto Rico are returned to the island’s treasury, making the industry a financial lifeline as well as a cultural one.
Coffee From the Central Mountains
Puerto Rico’s mountainous interior has ideal conditions for growing coffee, and the island has a coffee tradition dating back to the 1700s. Farms in the central mountain range (known as the Cordillera Central) grow several varieties, including Mundo Nuevo, Bourbon (both red and yellow), Caturra, Pacas, and a local selection called Puerto Rico 401. Research from the University of Puerto Rico found that Mundo Nuevo and Puerto Rico 401 were the highest-yielding varieties, averaging over 2,000 pounds of market coffee per acre annually when grown in full sunlight.
Puerto Rican coffee is known for its smooth, balanced flavor and is often classified as specialty-grade. Most of it is consumed locally, where coffee culture runs deep, though a growing share reaches mainland U.S. markets and international buyers willing to pay premium prices. Production volumes remain modest compared to major coffee-exporting countries like Colombia or Brazil, but the quality commands attention.
Technology and Professional Services
Beyond physical goods, Puerto Rico produces a growing volume of professional and technical services. The island’s GDP includes a measurable contribution from professional, scientific, and technical services (3.4 percent of GDP) along with finance and insurance (3.1 percent). Software development, engineering, scientific research and development, and licensing of intangible property all qualify for tax incentives under Puerto Rico’s economic development laws.
The island has positioned itself as a nearshore alternative for companies that want U.S.-based operations without mainland costs. Because Puerto Rico is a U.S. territory, businesses there operate under federal law, use the U.S. dollar, and don’t face the customs barriers that come with offshoring to a foreign country. That makes it attractive for companies in aerospace maintenance, software, and financial services looking to reduce overhead while staying within the U.S. legal framework.
Food, Livestock, and Other Agriculture
Coffee and sugarcane get the most recognition, but Puerto Rico’s farms also produce plantains, bananas, pineapples, papayas, and other tropical fruits. Dairy farming is the single largest agricultural subsector by revenue, with milk production concentrated in the northwestern and southern coastal areas. Poultry and egg production round out the livestock side. The island does not grow enough food to feed its population, so most groceries are imported, but local agriculture remains an important part of rural economies and cultural identity.
What Puerto Rico Exports
The vast majority of what Puerto Rico produces goes to the U.S. mainland, which counts as domestic trade and doesn’t show up in international export statistics. For international trade, Puerto Rico’s goods flow to many of the same partners as the broader U.S. economy. The top U.S. export destinations in 2024 were Canada, Mexico, China, the Netherlands, and the United Kingdom, and Puerto Rico’s pharmaceutical and device exports contribute to those totals.
The pharmaceutical sector alone makes Puerto Rico one of the most export-intensive economies per capita in the Western Hemisphere. When you combine drugs, medical devices, rum, and professional services, the island punches far above its weight for a territory of roughly 3.2 million people.