Refer to figure.
As speed increases above M_CRIT shock waves begin to form and drag increases more rapidly than it would have done without the shock waves. The additional drag is called wave drag and is due to energy drag and boundary layer separation.

Energy Drag

Energy drag stems from the irreversible nature of the changes which occur as an airflow crosses a shock wave. Energy must be used to provide the temperature rise across the shock wave and this energy loss is drag on the aircraft. The energy drag rises progressively as M_FS increases.

Boundary Layer Separation

In certain stages of shock wave movement there is a considerable flow separation. This turbulence represents energy lost to the flow and contributes to the drag. As M_FS increases through the transonic range, the shock waves move to the trailing edge and the separation decreases; hence, the drag coefficient decreases.