Exhibit 99.1
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Condensed Interim Consolidated Financial Statements
As
of September 30, 2025, and for the nine months ended
(In thousands of US dollars)
(Unaudited)
| 1 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Condensed Interim Consolidated Statements of Financial Position
(In thousands of US dollars)
(Unaudited)
As of September 30, 2025 | As of December 31, 2024 | |||||||
| $ | $ | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | ||||||||
| Trade and other receivables | ||||||||
| Inventories (note 4) | ||||||||
| Income taxes receivable | ||||||||
| Prepaid expenses and other assets (note 5) | ||||||||
| Assets held for sale (note 6) | ||||||||
| Total current assets | ||||||||
| Non-current assets | ||||||||
| Restricted cash and cash equivalents | ||||||||
| Property and equipment (note 7) | ||||||||
| Total non-current assets | ||||||||
| Total assets | ||||||||
| LIABILITIES | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued liabilities (note 8) | ||||||||
| Provisions | ||||||||
| Income taxes payable | ||||||||
| Current portion of deferred revenues (note 3) | ||||||||
| Current portion of lease liabilities | ||||||||
| Warrant liability (note 10) | ||||||||
| DSU liability | ||||||||
| Total current liabilities | ||||||||
| Non-current liabilities | ||||||||
| Deferred revenues (note 3) | ||||||||
| Provisions | ||||||||
| Lease liabilities | ||||||||
| Employee future benefits (note 9) | ||||||||
| Total non-current liabilities | ||||||||
| Total liabilities | ||||||||
| Shareholders’ equity | ||||||||
| Share capital (note 11) | ||||||||
| Contributed surplus | ||||||||
| Retained earnings (accumulated deficit) | ( | ) | ( | ) | ||||
| Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
| Total Shareholders’ equity | ||||||||
| Total liabilities and shareholders’ equity | ||||||||
Commitments (note 15)
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
Approved by the Board of Directors
| /s/ Peter H. Puccetti | /s/ David G. Spear | |
| Peter H. Puccetti, Chair of the Board | David G. Spear, Director |
| 2 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Condensed Interim Consolidated Statements of Changes in Shareholders’ Equity
For the nine months ended September 30, 2025, and 2024
(In thousands of US dollars)
(Unaudited)
| Share capital | Contributed surplus | Retained earnings | Accumulated other comprehensive loss | Total | ||||||||||||||||
| $ | $ | $ | $ | $ | ||||||||||||||||
| Balance – January 1, 2025 | ( | ) | ( | ) | ||||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||
| Other comprehensive loss: | ||||||||||||||||||||
| Foreign currency translation adjustments | ( | ) | ( | ) | ||||||||||||||||
| Actuarial gain on defined benefit plan (note 9) | ||||||||||||||||||||
| Comprehensive loss | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Share-based compensation costs | ( | ) | ( | ) | ||||||||||||||||
| Exercise of warrants (note 10) | ||||||||||||||||||||
| Exercise of DSUs (equity settled) | ( | ) | ||||||||||||||||||
| Balance – September 30, 2025 | ( | ) | ( | ) | ||||||||||||||||
| Share capital | Contributed surplus | Retained earnings | Accumulated other comprehensive loss | Total | ||||||||||||||||
| $ | $ | $ | $ | $ | ||||||||||||||||
| Balance – January 1, 2024 | ( | ) | ||||||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||
| Other comprehensive loss: | ||||||||||||||||||||
| Foreign currency translation adjustments | ( | ) | ( | ) | ||||||||||||||||
| Actuarial loss on defined benefit plan | ( | ) | ( | ) | ||||||||||||||||
| Comprehensive loss | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Acquisition of Aeterna Zentaris Inc. | ||||||||||||||||||||
| Share-based compensation costs | ||||||||||||||||||||
| Exercise of warrants | ||||||||||||||||||||
| Balance – September 30, 2024 | ( | ) | ( | ) | ||||||||||||||||
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
| 3 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Condensed Interim Consolidated Statements of Loss and Comprehensive Loss
For the three months ended September 30, 2025, and 2024
(In thousands of US dollars)
(Unaudited)
| Three months ended | Nine months ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| $ | $ | $ | $ | |||||||||||||
| Revenues (note 3) | ||||||||||||||||
| Cost of sales | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Gross profit | ||||||||||||||||
| Research and development | ||||||||||||||||
| Selling, general and administrative | ||||||||||||||||
| Impairment of property and equipment (note 7) | ||||||||||||||||
| Write-down of inventory (note 4) | ||||||||||||||||
| Impairment of intangible assets | ||||||||||||||||
| Total operating expenses | ||||||||||||||||
| Loss from operations | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Foreign exchange loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Finance costs | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Interest income | ||||||||||||||||
| Other income | ||||||||||||||||
| Change in fair value of warrant and DSU liabilities | ||||||||||||||||
| Other income | ||||||||||||||||
| Loss before income taxes | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Income tax recovery (expense) | ||||||||||||||||
| Net loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other comprehensive loss: | ||||||||||||||||
| Items that may be reclassified subsequently to profit or loss: | ||||||||||||||||
| Foreign currency translation adjustments | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Items that will not be reclassified subsequently to profit or loss: | ||||||||||||||||
| Actuarial gain (loss) on defined benefit plans (note 9) | ( | ) | ( | ) | ( | ) | ||||||||||
| Comprehensive loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Basic and diluted loss per share (note 13) | ) | ) | ) | ) | ||||||||||||
| Weighted average number of shares outstanding (basic and diluted) | ||||||||||||||||
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
| 4 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Condensed Interim Consolidated Statements of Cash Flows
For the three months ended September 30, 2025, and 2024
(In thousands of US dollars)
(Unaudited)
| Three months ended | Nine months ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| $ | $ | $ | $ | |||||||||||||
| Cash flows from operating activities | ||||||||||||||||
| Net loss for the period | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Items not affecting cash and cash equivalents: | ||||||||||||||||
| Depreciation and amortization | ||||||||||||||||
| Share-based compensation costs | ( | ) | ( | ) | ||||||||||||
| Impairment of intangible assets | ||||||||||||||||
| Impairment of property and equipment | ||||||||||||||||
| Write-down of inventory | ||||||||||||||||
| Employee future benefits | ||||||||||||||||
| Amortization of deferred revenues | ( | ) | ( | ) | ( | ) | ||||||||||
| Change in fair value of warrant and DSU liabilities | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other non-cash items | ||||||||||||||||
| Income tax recovery | ( | ) | ( | ) | ||||||||||||
| Changes in operating assets and liabilities (note 12) | ( | ) | ( | ) | ( | ) | ||||||||||
| Net cash used in operating activities | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Cash flows from financing activities | ||||||||||||||||
| Payments on DSU’s | ( | ) | ( | ) | ( | ) | ||||||||||
| Payments on lease liabilities | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net cash used in financing activities | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Cash flows from investing activities | ||||||||||||||||
| Acquisition of Aeterna Zentaris Inc. | ||||||||||||||||
| Purchase of property and equipment | ( | ) | ( | ) | ( | ) | ||||||||||
| Proceeds on disposal of property and equipment | ||||||||||||||||
| Changes in restricted cash equivalents | ( | ) | ||||||||||||||
| Net cash provided by (used in) investing activities | ( | ) | ||||||||||||||
| Effect of exchange rate changes on cash and cash equivalents | ( | ) | ( | ) | ||||||||||||
| Net change in cash and cash equivalents | ( | ) | ( | ) | ( | ) | ||||||||||
| Cash and cash equivalents – Beginning of period | ||||||||||||||||
| Cash and cash equivalents – End of period | ||||||||||||||||
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
| 5 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
1. | Business overview |
Summary of business
COSCIENS Biopharma Inc. and its subsidiaries (the “Company”), formerly Aeterna Zentaris Inc., is a Life Science company developing and commercializing a diversified portfolio of products for the cosmeceutical, nutraceutical and pharmaceutical markets. These products are produced using the Company’s proprietary technologies. The Company’s patented technologies include the Pressurized Gas eXpanded (PGX) technology, which is a unique technology that generates high-value yields of active ingredients from natural based resources for use in novel cosmeceutical, nutraceutical and pharmaceutical products. The Company’s two value-driving products, oat beta glucan and avenanthramides, are found in many household name cosmetic and personal care brands. These products are manufactured from the Company’s proprietary oat extraction manufacturing technology and are known for their well-documented health benefits.
These unaudited condensed interim consolidated financial statements were approved by the Board of Directors (the “Board”) on November 11, 2025.
These condensed interim consolidated financial statements have been prepared on the basis that the Company will continue as a going concern, which presumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future.
During
the three-month period ended September 30, 2025, the Company incurred a net loss and had negative cash flow from operating
activities of $
Assessing the Company’s ability to continue as a going concern necessitates significant judgment, relying on detailed financial forecasts with inherent estimates related to future sales, operating costs, research and development expenses, and capital expenditures. While the Company currently anticipates that its cash on hand and projected future cash flows from operations will be sufficient to cover its financial liabilities as they become due for at least the next twelve months from the issuance date of these condensed interim consolidated financial statements, these future cash flows are subject to several factors beyond the Company’s control.
A
significant portion of the Company’s revenue is derived from a single customer primarily located in the United States (Note 14),
exposing the Company to potential volatility in cash flows. Furthermore, on August 1st, 2025, the President of the United
States issued executive orders imposing
| 6 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
As such, there is material uncertainty that raises substantial doubt about the Company’s ability to continue as a going concern for a period of at least 12 months from the date of issuance of these condensed interim consolidated financial statements.
The condensed interim consolidated financial statements have been prepared on a going concern basis and do not include any adjustments that might be necessary if the going concern assumption was not appropriate. If the going concern assumption was not appropriate for these interim financial statements, then adjustments would be necessary to the carrying value of assets and liabilities, and the classification of items in the condensed interim consolidated statements of financial position. Such adjustments could be material.
| 2. | Basis of presentation |
These unaudited condensed interim consolidated financial statements have been prepared in accordance with IAS 34, Interim Financial Reporting as issued by the International Accounting Standards Board (“IASB”).
The unaudited condensed interim consolidated financial statements do not include all the notes normally included in annual consolidated financial statements. The unaudited condensed interim consolidated financial statements reflect all normal and reoccurring adjustments that are, in the opinion of management, necessary for a fair presentation of the results for the interim periods presented. Accordingly, these unaudited condensed interim consolidated financial statements should be read in conjunction with the Company’s annual consolidated financial statements as of and for the year ended December 31, 2024.
The accounting policies used in these condensed interim consolidated financial statements are consistent with those presented in the Company’s annual consolidated financial statements.
Transaction
On December 14, 2023, Aeterna Zentaris Inc. (“Aeterna”) and Ceapro Inc. (“Ceapro”) entered into a binding arrangement agreement pursuant to which Aeterna would acquire all of the issued and outstanding common shares of Ceapro (the “Transaction”) by way of a plan of arrangement. The Transaction was consummated on June 3, 2024.
For financial reporting and accounting purposes, Ceapro is the acquirer of Aeterna in the Transaction. The condensed interim consolidated financial statements of COSCIENS Biopharma Inc. as of September 30, 2025 and December 31, 2024 and for the three months and nine months ended September 30, 2025 and 2024 reflect the results of operations and financial position of Ceapro for the periods presented and includes the results of operations of Aeterna subsequent to the Transaction, which was completed on June 3, 2024.
Reclassifications
Certain
prior period amounts have been reclassified to conform to current period presentation. In the consolidated statements of loss for the
nine months ended September 30, 2024, the general and administration expenses of $
| 7 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
New standards and amendments
Several amendments apply for the first time for reporting periods beginning after January 1, 2025, but do not have an impact on the interim condensed consolidated financial statements of the Company. The IASB has published several new, but not yet effective, standards, amendments to existing standards, and interpretations. None of these standards, amendments to existing standards, or interpretations have been early adopted by the Company, and management anticipates that all relevant pronouncements will be adopted for the first period beginning on or after the effective date of the pronouncement.
Critical accounting estimates and judgements
The preparation of condensed interim consolidated financial statements in accordance with IFRS Accounting Standards requires management to make judgements, estimates and assumptions about the future that affect the reported amounts of the Company’s assets, liabilities, revenues, expenses and related disclosures. Judgements, estimates and assumptions are based on historical experience, expectations, current trends and other factors that management believes to be relevant at the time at which the Company’s condensed interim consolidated financial statements are prepared.
Management reviews, on a regular basis, the Company’s accounting policies, assumptions, estimates and judgements in order to ensure that the condensed interim consolidated financial statements are presented fairly and in accordance with IFRS Accounting Standards applicable to interim financial statements. Revisions to estimates are recognized prospectively. Critical accounting estimates and assumptions are those that have a significant risk of causing material adjustment and are often applied to matters or outcomes that are inherently uncertain and subject to change. As such, management cautions that future events often vary from forecasts and expectations and that estimates routinely require adjustment.
Critical accounting estimates and assumptions, as well as critical judgements used in applying accounting policies in the preparation of the Company’s condensed interim consolidated financial statements, were the same as those applied to Company’s annual consolidated financial statements as of and for the year ended December 31, 2024, other than the following:
Impairment of property and equipment
The Company is required to make judgments in assessing at the end of each reporting period whether there is any indication that an asset may be impaired. In making this assessment, the Company uses various indicators including, but not limited to, the impact of the US tariffs on the Company’s product sales, sustained decreases in revenue and profitability. When such an indication exists, the Company makes a number of estimates when determining the recoverable amount of an asset or a cash-generating unit, see note 6 and note 7.
| 8 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| 3. | Revenue |
The Company derives revenue from the transfer of goods at a point in time in the following categories:
| Three months ended | Nine months ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| $ | $ | $ | $ | |||||||||||||
| Active ingredients | ||||||||||||||||
| Pharmaceutical | ||||||||||||||||
Deferred revenue
The deferred revenue balance primarily relates to the advance consideration received in the form of non-refundable non-creditable upfront payment and milestone payments relating to list price approvals of Ghryvelin™ in the United Kingdom, Spain and Germany as per an exclusive licensing agreement for the commercialization of macimorelin (the “Licensed Product”) in the European Economic Area and the United Kingdom and an exclusive supply agreement for a period of ten years, subject to renewal, to supply such Licensed Product.
Revenue
for this contract will be recognized based on units of Licensed Product supplied. The total units that the Company expects to supply
pursuant to the Pharmanovia Agreement is an estimate, based on current projections and anticipated market demand, and therefore will
be a significant judgment that will be relied upon when using the outputs method to recognize revenue. The Company expects to recognize
the balance of the deferred revenue over the remaining period of eight years based on related patent application initiatives. For the
three months and nine months ended September 30, 2025, the Company recognized $ (2024 - $
Liabilities related to contracts with customers
The following table provides a summary of deferred revenue balances:
| September 30, 2025 | ||||||||||||
| Current | Non-current | Total | ||||||||||
| $ | $ | $ | ||||||||||
| Pharmanovia | ||||||||||||
| NK Meditech | ||||||||||||
| December 31, 2024 | ||||||||||||
| Current | Non-current | Total | ||||||||||
| $ | $ | $ | ||||||||||
| Pharmanovia | ||||||||||||
| NK Meditech | ||||||||||||
| 9 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| 4. | Inventories |
The Company had the following inventories at the end of each reporting period:
| September 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Raw materials | ||||||||
| Work in progress | ||||||||
| Finished goods | ||||||||
Inventories
expensed to cost of goods sold during the three-month period ended September 30, 2025, are $
During
the three-months ended September 30, 2025, the Company recorded an inventory write-down of $
| 5. | Prepaid expenses and other assets |
The Company had the following prepaid expenses at the end of each reporting period:
| September 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Prepaid insurance | ||||||||
| Prepaid research and development | ||||||||
| Other | ||||||||
| 6. | Assets held for sale |
During
the three-month period ended September 30, 2025, management made the decision to sell a heating, ventilation, and air conditioning (HVAC)
system and an Ethanol Recovery System (ERS) by December 31, 2025 due to underutilization. Management has received a purchase offer of
$
Refer to note 7 for information about assets that were classified as held for sale as at September 30, 2025
| 10 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| 7. | Property and equipment |
Components of the Company’s property and equipment are summarized below.
| Cost | ||||||||||||||||||||||||
| Equipment Not Available for Use | Equipment | Office and Computer Equipment | Buildings | Leasehold Improvements | Total | |||||||||||||||||||
| $ | $ | $ | $ | $ | $ | |||||||||||||||||||
| At January 1, 2024 | ||||||||||||||||||||||||
| Acquisition of Aeterna | ||||||||||||||||||||||||
| Additions | ||||||||||||||||||||||||
| Impairment | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Disposals | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Impact of foreign exchange rate changes | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| At December 31, 2024 | ||||||||||||||||||||||||
| Additions | ||||||||||||||||||||||||
| Impairment | ( | ) | ( | ) | ||||||||||||||||||||
| Disposals | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Impact of foreign exchange rate changes | ||||||||||||||||||||||||
| At September 30, 2025 | ||||||||||||||||||||||||
| Accumulated Depreciation | ||||||||||||||||||||||||
| Equipment Not Available for Use | Equipment | Office and Computer Equipment | Buildings | Leasehold Improvements | Total | |||||||||||||||||||
| $ | $ | $ | $ | $ | $ | |||||||||||||||||||
| At January 1, 2024 | ||||||||||||||||||||||||
| Amortization | ||||||||||||||||||||||||
| Disposals | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Impact of foreign exchange rate changes | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||
| At December 31, 2024 | ||||||||||||||||||||||||
| Amortization | ||||||||||||||||||||||||
| Disposals | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||
| Impact of foreign exchange rate changes | ||||||||||||||||||||||||
| At September 30, 2025 | ||||||||||||||||||||||||
| Carrying amount | ||||||||||||||||||||||||
| Equipment Not Available for Use | Equipment | Office and Computer Equipment | Buildings | Leasehold Improvements | Total | |||||||||||||||||||
| $ | $ | $ | $ | $ | $ | |||||||||||||||||||
| At December 31, 2024 | ||||||||||||||||||||||||
| At September 30, 2025 | ||||||||||||||||||||||||
During
the nine-month period ended September 30, 2025, the Company retired fully depreciated assets no longer in use of $
| 11 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
Included
in the net carrying amount of property and equipment at September 30, 2025, are right-of-use assets relating to buildings, in the amount
of $
Disposals
during the nine-month period ended September 30, 2025 include equipment reclassified to assets held for sale in the amount of $
Assets
classified as held for sale during the reporting period as described in note 6 were measured at the lower of carrying value and fair
value less costs to sell at the time of the reclassification, resulting in the recognition of an impairment loss of $
The Company considers the implementation of US tariffs during the period ended September 30, 2025 as a potential impairment indicator, which is amplified by the prevailing economic climate, pressures on gross margins, persistent revenue volatility, and ongoing operating losses. As a result, the Company performed an impairment assessment on the Active Ingredient CGU based on various probability-weighted scenarios concerning the impact of the US tariffs. The cash flows are derived from the budget for the next five years and do not include restructuring activities that the Company is not yet committed to or significant future investments that will enhance the performance of the assets of the CGU being tested. The significant estimates used in the determination of value in use included forecasted revenues, costs, growth rate, discount rate and the continuation of the CUSMA exemption on the Company’s sales to the US as being the most likely scenario. The recoverable amount of the CGU tested was estimated to be higher than its carrying amount and no impairment was required. No reasonable change in the discount rate or the terminal value growth could cause the carrying amount to exceed the recoverable amount. However, the removal of the CUSMA exemption and the subsequent prolonged application of US tariffs on the Company’s sales could potentially necessitate the recognition of an impairment loss in future periods.
| 8. | Accounts payable and accrued liabilities |
The Company had the following accounts payable and accrued expenses at the end of each reporting period:
| September 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Trade accounts payable | ||||||||
| Accrued research and development costs | ||||||||
| Accrued employee benefits | ||||||||
| Payroll tax and other statutory liabilities | ( | ) | ||||||
| Other accrued liabilities | ||||||||
| 12 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| 9. | Employee future benefits |
The change in the Company’s employee future benefit obligations is summarized as follows:
Nine months ended September 30, 2025 | Year ended December 31, 2024 | |||||||||||||||
| Pension | Other | |||||||||||||||
| benefit plans | benefit plans | Total | Total | |||||||||||||
| $ | $ | $ | $ | |||||||||||||
| Change in plan liabilities | ||||||||||||||||
| Balances – Beginning of the period | ||||||||||||||||
| Current service cost | ( | ) | ||||||||||||||
| Interest cost | ||||||||||||||||
| Actuarial loss (gain) from changes in financial assumptions | ( | ) | ( | ) | ( | ) | ||||||||||
| Benefits paid | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Impact of foreign exchange rate changes | ( | ) | ||||||||||||||
| Balances – End of the period | ||||||||||||||||
| Change in plan assets | ||||||||||||||||
| Balances – Beginning of the period | ||||||||||||||||
| Interest income from plan assets | ||||||||||||||||
| Employer contributions | ||||||||||||||||
| Employee contributions | ||||||||||||||||
| Benefits paid | ( | ) | ( | ) | ( | ) | ||||||||||
| Remeasurement of plan assets | ||||||||||||||||
| Unrecognized Asset due to Asset Ceiling | ( | ) | ( | ) | ||||||||||||
| Impact of foreign exchange rate changes | ( | ) | ||||||||||||||
| Balances – End of the period | ||||||||||||||||
| Net liability of the unfunded plans | ||||||||||||||||
| Net liability of the funded plans | ||||||||||||||||
| Net amount recognized as Employee future benefits | ||||||||||||||||
| Amounts recognized: | ||||||||||||||||
| In net loss | ( | ) | ||||||||||||||
| Actuarial gain (loss) on defined benefit plans in other comprehensive loss | ( | ) | ||||||||||||||
The
calculation of the employee future benefit obligation is sensitive to the discount rate assumption and other assumptions such as the
rate of the pension benefit increase. Discount rates were
| 13 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| 10. | Warrants |
Warrant activity for the nine months ended September 30, 2025, was as follows:
| Warrants | Weighted average exercise price | Amount | ||||||||||
| # | $ | $ | ||||||||||
| Balance – December 31, 2024 | ||||||||||||
| Exercised | ( | ) | ( | ) | ||||||||
| Expired | ( | ) | ||||||||||
| Change in fair value of warrants | ( | ) | ||||||||||
| Balance – September 30, 2025 | ||||||||||||
The fair value of the liability, classified as warrant liability, is subsequently remeasured at each reporting date and at settlement date using the Black-Scholes option pricing model, with changes in fair value recognized in profit or loss. At September 30, 2025, the following warrants were outstanding:
| Issuance date | Number | Weighted average remaining contractual life | Weighted average exercise price | |||||||||
| # | years | $ | ||||||||||
| August 2020 | ||||||||||||
| February 2021 | ||||||||||||
| June 2024 | ||||||||||||
| Balance – September 30, 2025 | ||||||||||||
| 11. | Shareholders’ equity |
Share capital
The Company has authorized an unlimited number of common shares (being voting and participating shares) with no par value, as well as an unlimited number of preferred, first and second ranking shares, issuable in series, with rights and privileges specific to each class, with no par value.
As discussed in Note 1, Business Overview, on June 3, 2024, each outstanding Ceapro common share was exchanged for of an Aeterna common share. Accordingly, all common shares, stock options and per share amounts in these interim condensed consolidated financial statements have been retroactively adjusted for all periods presented to give effect to the share exchange.
| 14 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| Common shares | Amount | |||||||
| # | $ | |||||||
| Balance – December 31, 2024 | ||||||||
| Granted | ||||||||
| Balance – September 30, 2025 | ||||||||
| Common shares | Amount | |||||||
| # | $ | |||||||
| Balance – December 31, 2023 | ||||||||
| Deemed issuance of shares to Aeterna shareholders | ||||||||
| Granted | ||||||||
| Balance – September 30, 2024 | ||||||||
Share-based compensation
The
compensation expense for the three months ended September 30, 2025, was $
| Stock options | Weighted average exercise price | |||||||
| # | $ | |||||||
| Balance – January 1, 2025 | ||||||||
| Cancelled / Forfeited | ( | ) | ||||||
| Balance – September 30, 2025 | ||||||||
| Stock options | Weighted average exercise price | |||||||
| # | $ | |||||||
| Balance – January 1, 2024 | ||||||||
| Granted - Replacement options | ||||||||
| Cancelled / Forfeited | ( | ) | ||||||
| Balance – September 30, 2024 | ||||||||
| 15 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| 12. | Supplemental disclosure of cash flow information |
| Three months ended | Nine months ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| $ | $ | $ | $ | |||||||||||||
| Changes in operating assets and liabilities: | ||||||||||||||||
| Trade and other receivables | ( | ) | ( | ) | ||||||||||||
| Inventory | ( | ) | ( | ) | ||||||||||||
| Prepaid expenses and other current assets | ( | ) | ||||||||||||||
| Accounts payable and accrued liabilities | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Deferred revenues | ||||||||||||||||
| Provision for restructuring and other costs | ( | ) | ( | ) | ||||||||||||
| Employee future benefits | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| ( | ) | ( | ) | ( | ) | |||||||||||
Additions
of property and equipment of $
| 16 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| 13. | Net loss per share |
| Three months ended | Nine months ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| $ | $ | $ | $ | |||||||||||||
| Net loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Basic and diluted weighted-average shares outstanding | ||||||||||||||||
| Basic and diluted loss per share | ) | ) | ) | ) | ||||||||||||
| Items excluded from the calculation of diluted net loss per share due to their anti-dilutive effect: | ||||||||||||||||
| Stock options and DSUs | ||||||||||||||||
| Warrants | ||||||||||||||||
| 14. | Segment information |
As of September 30, 2025 and a result of the transaction, the Company has two reportable and operating segments: Active ingredient and Biopharmaceutical. The Company’s chief operating decision maker assesses the performance of the reportable segments based on revenues and operating loss before selling, general & administrative expenses, other income and tax by segment. Selling, general and administrative expenses are expenses and salaries related to centralized functions, such as corporate finance, legal, human resources and technology teams, which are not allocated to segments. Accounting policies applied for the Active ingredient and the Biopharmaceutical segments are identical to those used for the purposes of the consolidated financial statements as described in Note 2 of the annual consolidated financial statements.
Active ingredient
The Active ingredient segment involves the development of proprietary extraction technologies and the application of these technologies to the production and development and commercialization of active ingredients derived from oats and other renewable plant resources for healthcare and cosmetic industries. Active ingredients produced include oat beta glucan, oat oil and avenanthramides. These and similar manufactured products are sold primarily through distribution networks.
Biopharmaceutical
The Biopharmaceutical segment includes the results of Aeterna Zentaris from its acquisition on June 3, 2024 (Note 3). The segment involves the commercializing and developing pharmaceutical therapeutics and diagnostic tests, including the Company’s product, Macrilen® (macimorelin). The segment also includes remaining costs associated with the development of our pre-clinical pipeline to potentially address unmet medical needs across several indications with a focus on rare or orphan indications.
| 17 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
The table below summarizes the relevant financial information by operating segment:
| Three months ended September 30, 2025 | ||||||||||||
| Active ingredient | Biopharmaceutical | Total | ||||||||||
| $ | $ | $ | ||||||||||
| Revenue | ||||||||||||
| Cost of sales | ( | ) | ( | ) | ( | ) | ||||||
| Gross margin | ( | ) | ||||||||||
| Research and development | ( | ) | ( | ) | ( | ) | ||||||
| Impairment of property and equipment | ( | ) | ( | ) | ||||||||
| Write-down of inventories | ( | ) | ( | ) | ||||||||
| Loss from operations before SG&A and other income (expenses) | ( | ) | ( | ) | ( | ) | ||||||
| Selling, general & administrative | ( | ) | ||||||||||
| Loss from operations | ( | ) | ||||||||||
| Net other income | ||||||||||||
| Loss before income taxes | ( | ) | ||||||||||
| Three months ended September 30, 2024 | ||||||||||||
| Active ingredient | Biopharmaceutical | Total | ||||||||||
| $ | $ | $ | ||||||||||
| Revenue | ||||||||||||
| Cost of sales | ( | ) | ( | ) | ( | ) | ||||||
| Gross margin | ||||||||||||
| Research and development | ( | ) | ( | ) | ( | ) | ||||||
| Impairment of intangible assets | ( | ) | ( | ) | ||||||||
| Loss from operations before SG&A and other income (expenses) | ( | ) | ( | ) | ||||||||
| Selling, general & administrative | ( | ) | ||||||||||
| Loss from operations | ( | ) | ||||||||||
| Net other income | ||||||||||||
| Loss before income taxes | ( | ) | ||||||||||
| 18 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| Nine months ended September 30, 2025 | ||||||||||||
| Active ingredient | Biopharmaceutical | Total | ||||||||||
| $ | $ | $ | ||||||||||
| Revenue | ||||||||||||
| Cost of sales | ( | ) | ( | ) | ( | ) | ||||||
| Gross margin | ||||||||||||
| Research and development | ( | ) | ( | ) | ( | ) | ||||||
| Impairment of property and equipment | ( | ) | ( | ) | ||||||||
| Write-down of inventories | ( | ) | ( | ) | ||||||||
| Loss from operations before SG&A and other income (expenses) | ( | ) | ( | ) | ||||||||
| Selling, general & administrative | ( | ) | ||||||||||
| Loss from operations | ( | ) | ||||||||||
| Net other income | ||||||||||||
| Loss before income taxes | ( | ) | ||||||||||
| Nine months ended September 30, 2024 | ||||||||||||
| Active ingredient | Biopharmaceutical | Total | ||||||||||
| $ | $ | $ | ||||||||||
| Revenue | ||||||||||||
| Cost of sales | ( | ) | ( | ) | ( | ) | ||||||
| Gross margin | ||||||||||||
| Research and development | ( | ) | ( | ) | ( | ) | ||||||
| Impairment of intangible assets | ( | ) | ( | ) | ||||||||
| Loss from operations before SG&A and other income (expenses) | ( | ) | ( | ) | ||||||||
| Selling, general & administrative | ( | ) | ||||||||||
| Loss from operations | ( | ) | ||||||||||
| Net other income | ||||||||||||
| Loss before income taxes | ( | ) | ||||||||||
Major Customer
During
the three months ended September 30, 2025, the Company had export sales to one major distributor of the Company’s products representing
| 19 |
COSCIENS Biopharma Inc. (formerly Aeterna Zentaris Inc.)
Notes to the Condensed Interim Consolidated Financial Statements
As of September 30, 2025, and for the three months ended September 30, 2025, and 2024
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| 15. | Commitments and Contingencies |
Significant expenditure under contracted supply agreements for at the end of the reporting period but not recognized as liabilities is as follows:
| TOTAL | ||||
| $ | ||||
| Less than 1 year | ||||
| 1 - 5 years | ||||
| More than 5 years | ||||
The
Company previously entered into license agreements with Agriculture Canada (AG) for a technology to increase the concentration of avenanthramides
in selected oat and with University of Alberta for a Pressurized Gaz expanded Technology (PGX) for the processing of various polymers.
The royalty percentage rate would be
| 20 |