Thanks for writing in.
The rash you are describing can be sebaceous cyst ,infected lipoma
Keep the area clean and dry.
You can apply Neosporin
ointment over the area.
Sebaceous cyst is more likely as it suits your description.
Rubbery bag you mention can be wall of the cyst.
It can reoccur if not treated properly.
Its better to remove it under aseptic condition for permanent cure.
I encourage you to visit a qualified dermatologist
for proper diagnosis and treatment.
Hope this helps.