OSI Pharmaceuticals (NASDAQ:OSIP) continues to prosper, and it has Tarceva to thank.

For its impressive second quarter, the drugmaker reported diluted earnings per share from continuing operations of $0.48, compared with a loss in the year-ago quarter. It's also a 45.5% increase over the company's Q1 earnings. Sales continue to flourish: Total revenues increased by 42% when compared with the company's 2006 second quarter.

It's apparent that the good news this quarter results from continued strong gains for the company's anti-cancer drug Tarceva, which it co-promotes with Genentech (NYSE:DNA) and Roche. Global net sales for Tarceva increased by 35% year over year.

The international market has been a particular growth area for Tarceva. Royalty revenues from Roche are based on the international sales of Tarceva, they've climbed 107% versus the year-ago quarter. This segment of revenues now accounts for 28.6% of the company's total revenues, versus only 19.6% in last year's Q2.

The stock got a boost out of the report. That was good for shareholders, who are looking to shake off the hangover effect from the company's decision to discontinue its eye-disease business, which consists primarily of a product that it has marketed with Pfizer (NYSE:PFE).

While OSI's Q2 was very promising, not everybody in our Motley Fool CAPS community is sold. Among the skeptics is CAPS player esebeus, whose leading bear pitch states:

Once Tarceva becomes obsolete around 2009, this stock is junk. Bad management. Poor upside.

That seems like a harsh assessment of the stock, given OSI's current results, but only time will tell whether the bears emerge victorious.

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Fool contributor Billy Fisher does not own shares of any of the companies mentioned. The Fool maintains a healthy disclosure policy.