Actually, your friend was right in his argument. When Paul wrote that verse in 2 Timothy, he was referring only to the Old Testament or should we say the "Hebrew Scripture". At that time, the New Testament is not yet canonized though most of the books of the New Testament were already written down. (The last book written was around 90-100 AD, the book of Revelation.)
Yes, 2 Timothy is the last letter written by Paul, but during that time he has no idea yet of the New Testament and what he has in mind when he said "all Scripture" is the Old Testament. The 27 books of the New Testament were canonized only during the time of Athanasius around 367 AD. However, even if the NT was compiled only during that time, the believers already have copies of the books in individual forms and they were using those books in churches and in their personal life. And they look at them as having the same authority as the Old Testament given the fact that they were written by people whom they know have met the Lord personally (just like Paul and the disciples) or at least have close connections with the disciples (like Luke and Mark).
And these writers of the NT actually didn't know that as time passed, what they wrote would be regarded as part of the Scripture. What they were thinking at that time was only for the preaching of the gospel of Jesus Christ, which they did through writing since they were already dying one by one. And another thing was for the strengthening of the church.
I do not discredit the fact that the New Testament is inspired by God, and it is indeed the word of God. However, as far as the argument of your friend is concerned, he is right when he said that what Paul was pertaining to when he said "all Scripture" is only the Old Testament.
