Drug and Druggists' Sundries Wholesalers

The 7,012 Drug and druggists’ sundries wholesalers in the US distribute biological and medical products; botanical drugs and herbs; pharmaceutical products; and related goods. Prescription drugs account for over 80% of industry sales. Other product categories include cosmetics and beauty supplies; vitamins and nutritional supplements; non-prescription drugs; and personal care items.

Regulated Environment

The distribution, compounding, purchase, and storage of pharmaceuticals is highly regulated by the Drug Enforcement Administration (DEA), FDA, and US Department of Health and Human Services (HHS).

Reimbursement Rates and Coverage

The drug wholesale industry is affected by changes to medical reimbursement rates, which continue to fall as the healthcare industry looks for ways to cut costs.

Sep 2, 2026 - Tariffs Proposed For Generic Pharmaceuticals

• President Trump has announced a plan to impose tariffs on imported generic drugs. The proposed tariff rate begins at 0% on August 1, 2026, and will increase to 100% by August 2028 and 200% the following year. The goal is to encourage pharmaceutical companies to move production to the United States, according to Trump administration officials. The policy on imported generic drugs could have a huge impact on the three distributors that control most US pharmaceutical distribution and on the logistics networks that move billions of dollars in medicines each year, according to FreightWaves. Every imported generic drug ultimately moves through a remarkably concentrated US distribution network. McKesson, Cardinal Health, and Cencora collectively control roughly 92% of pharmaceutical distribution revenue in the country, serving as the primary conduit between overseas manufacturers and American hospitals, pharmacies, and healthcare providers, according to FreightWaves.
• Fewer than half of Americans (49%) can consistently afford the care and medications they need, according to the latest West Health-Gallup Healthcare Affordability Index. Drug and druggists' sundries wholesalers may be negatively impacted by decreasing health care affordability. The share of adults who are “cost secure” has decreased from a 2022 peak of 61%, and an estimated 2.8 million more people fell out of that category between 2024 and 2025 alone. Cost insecurity now reaches groups long considered insulated: just 61% of adults 65 and older are cost secure, down from 73% in 2021.
• The three largest US pharmaceutical wholesalers — Cardinal Health, Cencora, and McKesson — are using vertical integration to strengthen their positions in the buy-and-bill market for provider-administered drugs, according to Gene Online. Wholesalers are expanding their influence beyond traditional drug distribution by integrating with downstream customers and acquiring stakes in practice management companies. Private equity roll-ups have played a key roll in providing wholesalers with opportunities to acquire ownership stakes in practice management firms.
• Drug and druggist’s sundries wholesaler industry employment and average wages for nonsupervisory employees increased slightly during the first five months of 2026, according to the US Bureau of Labor Statistics (BLS). Drug and druggist’s sundries wholesalers decreased prices slightly during the first six months of 2026, according to the BLS.

Industry size & Structure

The average drug wholesaler operates out of a single location, employs 44 workers, and generates about $187 million annually.

• The drug and druggists' sundries wholesale industry consists of about 7,012 firms that employ about 311,580 workers and generate $1.3 trillion annually.
• The industry is concentrated; the top 50 companies account for 89% of industry revenue.
• Large companies include McKesson, Amerisource Bergen, Cardinal Health, and JM Smith. Large firms may have international or pharmacy retail operations.