Aeterna Zentaris Expands Orphan Drug Development Pipeline with Targeted Immunosuppressive Therapeutics - Company licenses exclusive worldwide rights to develop, manufacture and commercialize targeted, highly specific imm

Zentaris Expands Orphan Drug Development Pipeline with Targeted Immunosuppressive Therapeutics

Company licenses exclusive worldwide rights to develop, manufacture and commercialize targeted, highly specific immunosuppressive

therapeutic proteins for the potential treatment of neuromyelitis optica spectrum disorder ("NMOSD") from Julius-Maximilians-University

of Wuerzburg, Germany

Initial step in growth strategy to build-out pipeline of assets

Aeterna Zentaris to develop potential therapeutic treatment option for neuromyelitis optica spectrum disorder ("NMOSD"),

an orphan indication with strong unmet medical need and significant market opportunity

S.C., January 28, 2021 - Aeterna Zentaris Inc. (NASDAQ: AEZS) (TSX: AEZS), through its wholly-owned subsidiary Aeterna

Zentaris GmbH, ("Aeterna" or the "Company"), a specialty biopharmaceutical company commercializing and

developing therapeutics and diagnostic tests, today announced that it has licensed the exclusive worldwide rights to develop,

manufacture and commercialize targeted, highly specific, autoimmunity modifying proteins ("AIM Biologicals") for the

potential treatment of neuromyelitis optica spectrum disorder ("NMOSD") from the Julius-Maximilians-University Wuerzburg

demonstrates Aeterna's commitment to execute on our stated plans of expanding our pipeline to have multiple assets in research

and development. The work that Dr. Valentin Bruttel and Prof. Joerg Wischhusen have conducted at the University represents what

we believe to be a compelling opportunity for innovative development in the high-value indication NMOSD, an orphan indication

with significant unmet need," commented Dr. Klaus Paulini, Chief Executive Officer of Aeterna.

Joerg Wischhusen of the University added, "Based on pre-clinical data obtained by the University to date, the AIM Biologicals

technology has the potential to be a breakthrough in the treatment of autoimmune-related diseases. It is based on a mechanism

developed by nature to protect the fetus from the mother's immune system without compromising immune protection against

foreign antigens. This has the potential to offer a new treatment for NMOSD patients. We believe that the collaboration with Aeterna

will accelerate the further development towards the clinic."

Modifying ("AIM") Biologicals - Targeted Immunosuppressive Therapeutics

pregnancy, the maternal immune system tolerates paternal antigens from the embryo but is still effective to protect mother and

embryo from foreign antigens. Parts of the natural mechanisms responsible for this feto-maternal immune tolerance form the scientific

basis for the concept of AIM Biologicals.

Biologicals utilize a novel mechanism which is believed to demonstrate that peptide antigens presented on immunosuppressive MHC

class I molecules can selectively and efficiently induce antigen-specific tolerance. Based on this mechanism, the targeted immunosuppressive

therapeutics are being designed as optimized soluble molecules with the goal that they may be adapted to selectively induce tolerance

to various autoantigens. Pre-clinical studies conducted by the University thus far indicate that tolerance induction appears to

be achieved via selective elimination of antigen-specific immune effector cells and via induction of antigen-specific regulatory

T cells from na ve T cells. AIM Biologicals thus have the potential to become highly specific and effective yet not personalized

treatments of NMOSD.

the treatment of NMOSD, it is believed that the AIM Biologicals will present a specific antigen derived from the water channel

protein aquaporin-4 (AQP4) loaded to soluble immunoregulatory HLA-G protein to selectively induce immunological tolerance in the

central nervous system.

collaboration with the University and the University clinic, Aeterna plans to conduct further pre-clinical research to identify

and characterize an AIM Biologicals based development candidate for the treatment of NMOSD, including meeting with the regulatory

authorities to confirm the further pre-clinical data required as we work towards advancing such candidate into human clinical

Neuromyelitis Optica Spectrum Disorder (NMOSD)

is an antibody mediated inflammatory central nervous system ("CNS") disorder that affects about one per million population

per year. NMOSD, also known as Devic disease, is a chronic disorder of the brain and spinal cord dominated by inflammation of

the optic nerve (optic neuritis) and of the spinal cord (myelitis). Typical symptoms include visual loss, muscle spasms, paraparesis,

and incontinence. If left untreated, 50% of individuals with NMOSD will be wheelchair bound and blind, and 30% will have died

within five years after the first attack. The water channel protein AQP4 is widely expressed in the brain, spinal cord, and optic

nerves. Auto-antibodies directed against the AQP4 channel play an important role in the pathogenesis of NMOSD.

there are only three approved medications available for the treatment of NMOSD with very high annual treatment costs, and the

risk of the patient contracting serious infections. Therefore, there is a strong medical need to offer new therapeutic options

the U.S. and Europe there are currently approximately 10,000 to 15,000 patients living with NMOSD. Of these the AQP4 antibody

seropositive patients who represent about 80% of the NMOSD population are the targeted patients for a potential therapy based

on the AIM Biologicals technology.

Terms and Conditions

the terms of the exclusive patent license agreement entered into with the University, Aeterna obtained worldwide rights to develop,

manufacture and commercialize products for the treatment of NMOSD using the AIM Biologicals technology for an up-front cash payment

of 100,000 and milestone payments to be paid upon the achievement of certain development and regulatory milestones

as well as royalty payments on net sales. Aeterna will be responsible for the formal preclinical and clinical development, regulatory

activities, and manufacturing of the licensed products. Aeterna has also engaged the University and University clinic to conduct

certain pre-development activities with respect to the AIM Biologicals program to be funded by Aeterna.

Company intends to continue balancing risks and secure growth opportunities by re-establishing a diversified, yet focused, development

pipeline to which Aeterna can best leverage its expertise and experience. Aeterna is focused on opportunistically utilizing its

network with universities in Europe and the U.S. The license of the AIM Biologicals program for NMOSD demonstrates Aeterna's

progress towards achieving its goal to obtain access to innovative development candidates in different indications, with a focus

on rare or orphan indications with potential significant commercial opportunity.

Aeterna Zentaris Inc.

Zentaris Inc. is a specialty biopharmaceutical company commercializing and developing therapeutics and diagnostic tests. The Company's

lead product, macimorelin, is the first and only U.S. FDA and European Commission approved oral test indicated for the diagnosis

of adult growth hormone deficiency (AGHD). Macimorelin is currently marketed in the United States under the tradename Macrilen

through a license agreement with Novo Nordisk where Aeterna receives royalties on net sales. According to a commercialization

and supply agreement, MegaPharm Ltd. will seek regulatory approval and then commercialize macimorelin in Israel and the Palestinian

Authority. Additionally, upon receipt of pricing and reimbursement approvals, Aeterna expects that macimorelin will be marketed

in Europe and the United Kingdom through a recently established license agreement with Consilient Health Ltd. and Aeterna will

receive royalties on net sales and other potential payments.

is also leveraging the clinical success and compelling safety profile of macimorelin to develop it for the diagnosis of childhood-onset

growth hormone deficiency (CGHD), an area of significant unmet need.

is actively pursuing business development opportunities for the commercialization of macimorelin in Asia and the rest of the world,

in addition to other non-strategic assets to monetize their value. For more information, please visit www.zentaris.com

and connect with the Company on Twitter, LinkedIn and Facebook.

press release contains forward-looking statements (as defined by applicable securities legislation) made pursuant to the safe-harbor

provision of the U.S. Securities Litigation Reform Act of 1995, which reflect our current expectations regarding future events.

Forward-looking statements include those relating to the potential to obtain the necessary pre-clinical data and regulatory approvals

necessary to advance any product using the AIM Biologicals technology into human clinical trials or to develop the AIM Biologicals

to treat NMOSD or any other indication into an approved product, the ability of any product using the AIM Biologicals technology

to compete with existing approved products (or any other products in development) for NMOSD, the ability of the Company to obtain

approval of macimorelin for CGHD, the Company's ability to secure marketing partners for macimorelin in other key markets,

the timing of the commencement of the CGHD Study P02, and may include, but are not limited to statements preceded by, followed

by, or that include the words "will," "expects," "believes," "intends," "would,"

"could," "may," "anticipates", "potential" and similar terms that relate to future

events, performance, or our results. Forward-looking statements involve known and unknown risks and uncertainties, including those

discussed in this press release and in our Annual Report on Form 20-F, under the caption "Key Information - Risk Factors"

filed with the relevant Canadian securities regulatory authorities in lieu of an annual information form and with the U.S. Securities

and Exchange Commission. Known and unknown risks and uncertainties could cause our actual results to differ materially from those

in forward-looking statements. Such risks and uncertainties include, among others, our ability to raise capital and obtain financing

to continue our currently planned operations, our ability to continue to list our Common Shares on the NASDAQ, our now heavy dependence

on the success of Macrilen (macimorelin) and related out-licensing arrangements and the continued availability of funds

and resources to successfully commercialize the product, including our heavy reliance on the success of the License Agreement

with Novo Nordisk, the global instability due to the global pandemic of COVID-19, and its unknown potential effect on our planned

operations, including studies, our ability to enter into out-licensing, development, manufacturing, marketing and distribution

agreements with other pharmaceutical companies and keep such agreements in effect, our reliance on third parties for the manufacturing

and commercialization of Macrilen (macimorelin), potential disputes with third parties, leading to delays in or termination

of the manufacturing, development, out-licensing or commercialization of our product candidates, or resulting in significant litigation

or arbitration, uncertainties related to the regulatory process, unforeseen global instability, including the instability due