I'm going against what I normally use for dream interpretation here and I'm gonna start with Freud instead of Jung...

Freud considered dreams to be the subconscious id bringing to life fears and desires of the inner self to conquer/fulfill them when it can't be done in the waking life. On the surface, perhaps the urge to cut has been repressed...bottled up with the use of medication (pardon the pun, but that's how I see myself so I'm offering it here). Whatever desire cutting fulfilled in you still lingers, and in the dream your subconscious self can safely fulfill the want in the best way you know how, via the razor blade.

But imagery is still symbolic, and perhaps the symbolism behind bleeding was so built up in your subconscious that it burst forth as cutting in the waking world. So what is cutting a symbol for? Simply put, you're opening yourself up. You're vulnerable and you want to see that vulnerability and you want it to be seen by others (otherwise it wouldn't be from shoulder to wrist....it would be much smaller). I could be wrong here, but I'd be willing to wager that the vulnerability is at least a tip of the iceberg.