In case you haven't gotten the memo, these are challenging economic times. Oh, and healthcare, which has traditionally been viewed as recession-proof, is feeling the pinch too.

That theme was clear throughout the 4th annual Nasdaq OMX Healthcare Forum, co-sponsored by Leerink Swann, Monday in New York.

"We're not sure whether anyone has gotten the message yet today that this is a challenging environment. If anyone has any doubts about that, we've stated it at least 10 or 20 times during the course of the discussion," Jonathan Gertler, MD, managing director and head of biopharma banking at Leerink Swann, said during a webcast afternoon panel he moderated called, "alternatives for creating value in a challenging time."

But that overall theme of the forum emerged much earlier in the day, with Daniel Dubin, MD, vice chairman at Leerink Swann, repeating the phrase, "These trying times" several times during his welcome and keynote address.

"When one looks at the industries where the U.S. provides true leadership, healthcare has to be at the top ... this is an area where we still lead on the development and the commercialization front," Dubin said. "It's critical that we think about how to fund this innovation and restore some order to the capital markets that bridge these companies to points of success so we can sustain this leadership.

Dubin presented a slide outlining the positive and negative factors that are impacting healthcare. On the plus side: there is an aging population to consume more healthcare; the promise of expanding health coverage; better educated and more avid consumers; and a strong culture of entitlement to quality healthcare. On the flip side: patent expiries on drugs and generic threats; FDA approval process higher hurdles to market entry, decreased visibility into product approval standards, increased focus on safety leading to more expensive trials; biogenerics and drug reimportation; cost control measures by payors; and reimbursement pressure that may accompany healthcare reform.

"Historically, healthcare has been a defensive haven in tough capital markets, as one can see investors have relied upon the relative stability of healthcare stocks to help them weather through tough market environments, there's been relatively decreased volatility and even in tough markets some degree of absolute return," Dubin said.

But that's no longer the case.

"In today's trying times, while one can see that healthcare indexes are doing relatively better ... on an absolute basis healthcare has not been a place to hide. As one can see, there's been substantial decline even in healthcare stocks," he said, pointing to another slide. "The tough capital markets have created a difficult situation."

Despite this, "it's absolutely critical that we find ways to help fund these companies," Dubin said.

So, what are some alternatives to creating value in this challenging environment? During the discussion Gertler moderated, panel member Arthur Klausner, a partner at Pappas Ventures, said his firm is starting to ask its portfolio companies to focus on one lead product or program, rather than trying to manage a diversified product offering.

"If you look at the stock market and you look at what's happened when the lead program fails and a company goes down below cash that's the market saying, 'yeah, yeah, yeah, it'd be great if you have a diverse product offering and we'll pay attention to that if your lead product seems to be working, but if your lead product goes we're really not interested'," Klausner said.

"We're really asking our companies to slim down the number of projects that they're doing to work in a virtual or semi-virtual mode in order to conserve as much cash as possible," Klausner continued. "And from our part, we're trying to work alongside likeminded deep-pocketed syndicate investors so we don't get caught in a situation where lack of cash forces us and the company to go back to the private markets sort of hat-in-hand and say 'what do you think this is worth, we don't have any other offers so please put something on the table'."

But for some companies, focusing on one development program may be easier said than done, as panelist Ken Zuerblis, CFO of ImClone Systems (New York), pointed out.

"It's very hard to be a one-product company out there," Zuerblis said. "This is a very difficult business and I understand focus ... as you start to get larger, to attract the kind of talent you need you have to have something for those scientists to fall on as you get further."

Another member of that panel, Randall Mills, CEO of Osiris Therapeutics (Columbia, Maryland), offered up his company's secret to success.

"Creativity is very important for us, execution is very important to us, and doing it in a way which is non-dilutive," Mills said. "We are a company that believes very strongly in a pay-as-you-go, we're not a 'Field of Dreams' company where if you build it they'll come, we really believe in creating our own value and doing it as creative as possible."

Mills also noted that a company behaves differently when it has worked to build a product from the ground up, rather than acquiring it late in the development process.

"You behave like it's your money and everybody in the company behaves like it's their money because everybody in the company worked to create it," Mills said, adding that it is important to have plenty of cash on hand and to spend every dollar wisely.

Despite the "trying times" that were such a theme throughout the Nasdaq OMX Healthcare Forum, Klausner said that with careful consideration of the risks, the current economic environment does present some opportunities.

"We think that now is a great time to buy, so to speak, or invest, but you have to do it carefully ... you want to be paid off on that [key risk]," Klausner said.