The strong dollar struck Novartis (NYSE:NVS) again. The Motley Fool Global Gains selection managed a solid 8% sales increase in local currencies, mostly on higher sales volume, only to see all of that disappear when converted into U.S. dollars, its reporting currency. Sales were down 2%.

The bad year-over-year currency comparison hurt the bottom line as well. After adding in the cost of a bond it issued to pay for the acquisition of shares of Alcon (NYSE:ACL) from Nestle, earnings per share were down 9%.

But difficult currency comparisons won't last forever, and Novartis is still headed in the right direction, even if the final numbers don't show it. So rather than dwelling on the past, let's look ahead, shall we?

Like almost all pharmaceutical companies, Novartis has drugs facing generic competition in a few years. Diovan, the company's blood pressure medication, may not be as big a household name as Pfizer's (NYSE:PFE) Lipitor or Plavix from Bristol-Myers Squibb (NYSE:BMY) and sanofi-aventis (NYSE:SNY), but it’s a major contributor for Novartis, bringing in $2.9 billion in the first half of the year. Unfortunately, just like Lipitor and Plavix, it's headed for generic competition in the next few years.

Fortunately, Novartis seems to have a solution for the lost revenue: new drugs. Recently launched products, such as its new cancer drug, Afinitor, contributed 16% of pharmaceutical revenue this quarter, up from 10% last year.

Novartis could also see new growth in the coming years via follow-on biologics from its generic Sandoz division. While making generic versions of biotech drugs will have a lot of competition from companies like Teva Pharmaceutical (NASDAQ:TEVA) and Merck (NYSE:MRK), Novartis has established itself as a leader in making these drugs and should be at the front of the line when the U.S. opens its doors.

As long as it can keep growing sales, Novartis looks pretty cheap with its relatively low P/E and high dividend yield.

Grow into this Foolishness:

Find out why Novartis and Alcon are both Global Gains selections. Click here to grab a 30-day trial subscription to the newsletter, where you'll see all of our current picks for a global economy.

Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. Pfizer is a recommendation of the Inside Value newsletter. The Fool has a disclosure policy.