but investors are looking behind it and that's what is pushing this Dow component down this morning. For example, JNJ says its topline growth would have been just 3.6% instead of 13% if it had not bought Pfizer's consumer health care business last year for $16.6 billion. JNJ is kind of a three-pronged hybrid: pharma, medical devices and consumer healthcare.
The consumer unit saw a 49% surge in sales in the second quarter. And it was that robust growth coupled with continuing cost-cutting at the company that drove the Q2 results. In the medical device unit, sales at Cordis which makes stents, U.S. sales plummeted 26% over the same time last year. That's the result of the long-term safety issues surrounding drug-coated stents and the study issued earlier this year showing old-fashioned, much cheaper heart drugs may work just as well, if not better, than stents.
On the plus side, on the conference call JNJ officials say the stent business decline looks like it might have stabilized in Q2. They said drug-coated stent market penetration is now sitting at around 65%. In other words, about 6 out of every 10 stents being used today are drug coated. That's down from 8 or 9 out of 10 during the same time last year. Officials also added that stent prices have also fallen about three percent.
However, officials said they cannot call a bottom yet in the decline of its anemia drug franchise, Procrit. Sales of that blockbuster drug dropped 14% in the U.S. in Q2. The drug is under pressure over safety and reimbursement issues. And JNJ officials are also pointing the finger at Amgen . On the call, one executive said the decline is also due to "our competitor's anti-competitive contracting." Amgen makes similar drugs called Aranesp and Epogen and there have been recent reports that the company is offering doctors lucrative rebates to prescribe them.
The biotech giant reports its earnings on July 26th, but investors are looking at JNJ's Procrit numbers as a harbinger of AMGN's results: as I write this AMGN shares are down 1%. Last week, JNJ announced it will do its biggest stock buyback in company history--$10 billion. The company says the timeline for buying the shares is open-ended and it could call off the program at any time. Officials say they'll use cash and debt to make the purchases.
Pfizer is up next in big pharma. It reports earnings before the bell tomorrow morning with a conference call scheduled for midday. Watch the Lipitor sales number. Earlier this year, PFE said it could see a slight decline in Lipitor sales this year in the face of intense competition from generic Zocor and branded cholesterol drugs like Merck and Schering-Plough's Vytorin and AstraZeneca's Crestor. Lipitor is, by far, the biggest-selling drug in the world with sales last year of about $13 billion.
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