It can get better, however, with some very simple policy regarding foreign healthcare monopsonies. You can see that America functionally subsidizes the world's medical costs, but you can't remedy that by simply forcing pharma companies to take lower margins, because that affects what the companies buy. The more useful way of dealing with it is to prevent foreign countries from exercising market power, so that pharma companies can spread development costs over a larger base of customers, bringing US costs down and raising the artificially-low foreign costs. You can do this by striking a nuanced form of reimportation that becomes legal when pharma cos and foreign insurance companies renew their contract - by universalizing the market, the pharma company has the power to walk away from individuals because the opportunity cost of a sh**ty deal goes up. This forces foreign insurance companies to cooperate.
1999-TTM (Operating CF - Investing CF)/Revenue
Pfizer, 16.4% (I started with PFE and AMGN cuz PFE, JNJ and AMGN are the best run companies in the space, and JNJ isn't comparable because of their large consumer goods segment)
Bristol Myers Squibb: 12.6%
This is just big pharma - if you think that big pharma pressures little pharma into taking lower expected returns for less uncertainty (which is absolutely the case) this margin for pharma as a whole goes way, way down - you're looking at under 10% overall cash margins. On a risk adjusted basis, there isn't a ton of room for pressure before they start cutting back.
These take me a while to calculate (they do overweight recent history ever so slightly but not significantly), but my source is morningstar.com, so if you're interested in other companies, you can find it there (again, with the exception of JNJ, because of their consumer goods division), but you can see that once you factor in acquisitions for R+D, these companies' margins drop sharply from the lofty mid 20%s you see on income statements.