Drugs can be classified in many ways: by the way they are dispensed--over the counter or by prescription; by the substance from which they are derived-plant, mineral, or animal; by the form they take-capsule, liquid, or gas; and by the way they are administered-by mouth, injection, inhalation, or direct application to the skin (absorption). Drugs are also classified by their names. All drugs have three names: a chemical name, which describes the exact structure of the drug; a generic or proprietary name, which is the official medical name assigned by the United States Adopted Name Council (a group composed of pharmacists and other scientists); and a brand or trade name given by the particular manufacturer that sells the drug. If a company holds the patent on a drug-that is, if the company has the exclusive right to make and sell a drug, then the drug is available under one brand name only. After the patent expires, typically after 17 years in the United States, other companies can also manufacture the drug and market it under the generic name, or give it a new brand name.

Another way to categorize drugs is by the way they act against diseases or disorders: chemotherapeutic drugs attack specific organisms that cause a disease without harming the host, while pharmocodynamic drugs alter the function of bodily systems by stimulating or depressing normal cell activity in a given system. The most common way to categorize a drug is by its effect on a particular area of the body or a particular condition.