Johnson & Johnson's (NYSE:JNJ) earnings report reads like a one-hit wonder's second album. It goes from good to bad in the blink of an eye -- or in this case, a paragraph or so.

The report, released yesterday, shows that year over year, worldwide sales rose 12.7%. But almost a quarter of that increase owed to currency changes (and the dollar can't drop forever). That increase also includes the acquisition of Pfizer's (NYSE:PFE) Consumer Healthcare (PCH), which JNJ took over in December of last year. On a pro fofrma basis, including PCH in both quarters, the increase in sales was a measly 2.4%. Add to that a $528 million restructuring charge, and the earnings per share for the quarter actually fell 6% year over year.

The company's pharmaceutical segment was up a paltry 3.7% in sales in the same period. The segment actually had some products with decent growth, but it was dragged down by generic competition and slumping sales of erythropoiesis-stimulating agents PROCRIT (down 27%) and EPREX (up only 1%). J&J and Amgen (NASDAQ:AMGN) have been waging war with the FDA and Medicare to keep the two anemia drugs on the market and paid for.

J&J saw year-over-year U.S. sales of its drug-eluting stent CYPHER decline by 44%. The company was able to hold steady its share of the ever-shrinking U.S. market, suggesting that Boston Scientific (NYSE:BSX) will likely report similar slumping U.S. sales when it reports earnings later this week. Why Medtronic (NYSE:MDT) wants to get into the U.S. market is beyond me.

The earnings release wasn't all bad news. Sales of REMICADE, used to treat immune-mediated inflammatory diseases, grew by 6%, even in the face of increasing competition from Abbott Laboratories' (NYSE:ABT) Humira and Amgen's Enbrel.

The future for J&J looks much better than the present in my eyes. The company has repurchased $2 billion of its stock, and it plans to repurchase another $8 billion if it continues to believe its stock is undervalued. The restructuring charges won't go on forever, but their effect should be felt relatively quickly with increased operating margins from the new leaner J&J.

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