With all the sarcasm, it's hard to tell how broad of a point you're trying to make. Do dispute the fact that Australia free-rides to a non-trivial extent on US medical R&D?

Yes I do dispute that notion. Actually I dispute the entire idiot notion that the US is somehow subsidising the rest of the worlds' healthcare.

In actual fact, pharmaceutical / medical device companies will simply charge whatever the market will bear, and it just so happens the US market will bear almost any price. If some market won't bear a profit making price, pharma companies simply won't sell into it.

It makes utterly no sense to sell at a loss and then cross subsidise using the massive rents extracted from US markets, yet that is exactly what most people here seem to think is happening. Although maybe Trump really has managed to 'make America great again'. Speaking of great...

The US spends 17.1% of of its GDP on healthcare. The 5 countries that are richer than the USA (GDP per capita) pay an average of 7.77%. Excluding Qatar, it's 9.03%. The top 10 richest countries (excluding the USA) spend an average of 8.03% of their GDP on healthcare, and I'm pretty sure at least a few of these have universal public health insurance.

You're paying more than DOUBLE compared to the 9 other richest countries in the world. You're simply getting gouged. If you can't even admit that maybe there's a problem here, and instead want to persist with all these insane American exceptionalist fantasies, it's unlikely anything is going to change in American healthcare.

Data from here: http://data.worldbank.org/indicator/SH.XPD.TOTL.ZS?end=2014&...

And here: https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nomi... (using IMF GDP figures)

That's a long rant that doesn't even address the standard econ 101 argument. It's especially weird to quote spending data since that's what one would expect if the US was subsidizing the world.

It's also what one would expect if US consumers are getting horribly gouged on prices. But then I guess you'd also expect to see pharmaceutical companies enjoying super high profit levels... Oh wait...

EDIT: Given I am unable to address the 'econ101 argument', would you care to take a shot?

No, I think your tone is completely inappropriate for HN and is not compatible with a constructive discussion.

Fair enough.

FWIW I do apologise for the sarcastic tone of my posts above. You're right; it's probably not the right way to spark a constructive discussion. To be honest, my tone was a fairly deliberate departure from how I usually post. It's just that I've been in a number of these 'US Healthcare' discussions on HN now and have seen the same points and counterpoints made many times, yet no progress seems to have been made.

I suppose that's a good indication that I should just stay out of these threads until I can maintain a civil tone.

> Marketing expense: $19.9bn

Here I go tilting at this windmill again...

"Selling, marketing, and administrative expenses" (SMA) is not just marketing or advertising. It is all the costs of operating the company that are not either R&D or direct costs of producing products sold.

Less than half of JNJ's revenues is pharmaceuticals, so not a great example to be honest.

Actually it's a pretty good example. In Australia, medicines and medical devices (i.e. 81% of J&J revenue) are regulated by the same body (the TGA) using the same approach, craftily reasoning that sick people need both. I realise you might see thing differently (i.e. better) in the USA, but I guess that's just part of what makes you exceptional!

Medical devices and pharmaceutical companies have different cost structures, so I maintain my point that J&J is not a good example of a pharmaceutical cost structure.

But you did 10 minutes of Googling so I defer to you I guess.

"Johnson & Johnson's brands include numerous household names of medications and first aid supplies. Among its well-known consumer products are the Band-Aid Brand line of bandages, Tylenol medications, Johnson's baby products, Neutrogena skin and beauty products, Clean & Clear facial wash and Acuvue contact lenses."

  -- https://en.wikipedia.org/wiki/Johnson_%26_Johnson

Literally every single one of those products listed fall under their 'Consumer Segment' (see pages 7 & 8 of financial statements in original post). The entire consumer segment accounts for 18.5 per cent of their total revenue.

The remaining 81.5 per cent of their revenue comes from the sale of pharmaceuticals and medical devices.

The original post was listing the "consolidated" figures. Marketing of consumer products was not broken out separately from the consolidated figures.

The information in the pdf does not support the narrative of the original article, because of the use of consolidated figures.

Your link says that $19.9 is marked as "selling, marketing, and administrative expenses".

It looks like a dumpster category for all kinds of expenses, not just "marketing".

>> So, on behalf of my fellow Australians, I'd just like to thank J&J for selling into my country at a substantial loss

Are they really making a loss in Australia? Your source doesn't say that.