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You'll need to make the drop cap a separate object and apply text wrap to that object. Easiest way would be select the drop cap, convert it to paths (this will make it an anchored object), de-anchor the drop cap, then apply text wrap.
- Select the drop cap.
- Press Command-Option-O or Control-Alt-O. (This will convert the letter to an anchored object.)
- Select the letter then go to Anchored Object Options. Set its positioning to Custom. (Until you do that you cannot release it so it is no longer an anchored object).
- Remove the drop cap from the paragraph.
- Select the drop cap and go to Object > Anchored Object > Release.
- Apply text wrap.

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