Condensed Interim Consolidated Financial Statements ( Unaudited ) Aeterna Zentaris Inc. As at

Interim Consolidated Financial Statements

at September 30, 2019 and for the three-month and nine-month periods ended September 30, 2019 and 2018 (presented in

thousands of US dollars)

at September 30, 2019 and for the three-month and nine-month period ended September 30, 2019 and 2018

Interim Consolidated Financial Statements

and contingencies (note 18)

accompanying notes are an integral part of these condensed interim consolidated financial statements.

by the Board of Directors

accompanying notes are an integral part of these condensed interim consolidated financial statements.

accompanying notes are an integral part of these condensed interim consolidated financial statements.

accompanying notes are an integral part of these condensed interim consolidated financial statements.

accompanying notes are an integral part of these condensed interim consolidated financial statements.

Zentaris Inc. ("Aeterna Zentaris" or the "Company") has incurred significant expenses in its efforts to

develop and co-promote products. Consequently, the Company has incurred operating losses and negative cash flow from operations

historically and in each of the last several years except for the year ended December 31, 2018 when the Company earned revenue

from the sale of a license for the adult indication of Macrilen (macimorelin) in the United States and Canada (note 5).

As at September 30, 2019, the Company had an accumulated deficit of $317 million. The Company also had a net loss of $5,036 for

the nine months ended September 30, 2019, and negative cash flow from operations of $7,771 in this period.

Company's principal focus is on the licensing and development of Macrilen (macimorelin) and it currently does not

have any other approved products. Under the terms of License and Assignment Agreement (as defined below), Novo Nordisk A/S ("Novo")

is funding 70% of the pediatric clinical trial submitted to the EMA and FDA, the Company's sole development activity.

March 12, 2019, the Company announced that its board of directors formed a special committee of independent directors (the "Special

Committee") to review strategic options available to the Company and the engagement of Torreya, its financial advisor. In

October 2019, the Company ended its arrangement with Torreya and re-commenced business development activities on its own. Based

on the contract with Torreya, should the Company agree to license macimorelin to certain companies in a defined period of time

after the cancellation of the contract the Company would owe a fee to Torreya

has evaluated whether material uncertainties exist relating to events or conditions and has considered the following in making

that critical judgment.

ability of the Company to realize its assets and meet its obligations as they come due is dependent on earning sufficient revenues

under the License and Assignment Agreement, developing opportunities for Macrilen (macimorelin) in the rest of the world,

realizing other monetizing transactions, and raising additional sources of funding, the outcome of which cannot be predicted at

this time. The revenue provided under the License and Assignment Agreement was $29 for the nine months ended September 30, 2019

and as at September 30, 2019, the Company had cash of $10,862. In September 2019, the Company closed an equity financing which

provided $4,202 in net cash proceeds.

significant portion of the Company's cash is held in Aeterna Zentaris GmbH ("AEZS Germany"), our wholly owned

German subsidiary. AEZS Germany is also the counter-party for revenue earned under the License and Assignment Agreement. If and

when current and medium term liabilities of AEZS Germany exceed the values ascribed to AEZS Germany's assets, it may no

longer be possible under applicable German solvency laws for AEZS Germany's operations to continue. The Company has some

discretion to manage research and development costs, administrative expenses and capital expenditures in order to maintain its

cash liquidity; however, the Company will need to conclude agreement(s) for licensing or selling the European or worldwide rights

to Macrilen (macimorelin) and, if necessary, obtain further financing in order to continue its currently planned operations.

has assessed the Company's ability to continue as a going concern and concluded that additional capital will be required.

There can be no assurance that the Company will be able to execute license or purchase agreements or to obtain equity or debt

financing, or on terms acceptable to it. Factors within and outside the Company's control could have a significant bearing

on its ability to obtain additional financing. As a result, management has determined that there are material uncertainties that

may cast significant doubt upon the Company's ability to continue as a going concern.

financial statements have been prepared on a going concern basis, which asserts the Company has the ability in the near term to

continue to realize its assets and discharge its liabilities and commitments in a planned manner giving consideration to the above

and expected possible outcomes. Conversely, if the going concern assumption is not appropriate, adjustments to the carrying amounts

of the Company's assets, liabilities, revenues, expenses and balance sheet classifications may be necessary, and these adjustments

Company is a specialty biopharmaceutical company which is commercializing novel pharmaceutical therapies. On December 20, 2017,

the FDA granted marketing approval for Macrilen (macimorelin) to be used in the diagnosis of patients with adult growth

hormone deficiency ("AGHD"). On January 16, 2018, the Company, through AEZS Germany, entered into a license and assignment

agreement with Strongbridge Ireland Limited ("Strongbridge") to carry out development, manufacturing, registration,

regulatory and supply chain services for the commercialization of Macrilen (macimorelin) in the United States and Canada

(the "License and Assignment Agreement"). Effective December 19, 2018, Strongbridge sold the United States and Canadian

rights to Macrilen (macimorelin) under the License and Assignment Agreement to Novo.

unaudited condensed interim consolidated financial statements have been prepared in accordance with International Financial Reporting

Standards as issued by the International Accounting Standards Board ("IFRS") applicable to the preparation of interim

financial statements, including IAS 34, Interim Financial Reporting. These unaudited condensed interim consolidated financial

statements should be read in conjunction with the Company's annual consolidated financial statements as at and for the year

ended December 31, 2018.

accounting policies in these condensed interim consolidated financial statements are consistent with those presented in the Company's

annual consolidated financial statements, except for the adoption, of IFRS 16, Leases, effective January 1, 2019. See note

4 for the impact of the adoption of IFRS 16.

unaudited condensed interim consolidated financial statements were approved by the Company's Board of Directors on November

described in Note 1, these unaudited condensed interim consolidated financial statements were prepared on a going concern basis.

preparation of condensed interim consolidated financial statements in accordance with IFRS requires management to make judgments,

estimates and assumptions that affect the reported amounts of the Company's assets, liabilities, revenues, expenses and

related disclosures. Judgments, 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.

reviews, on a regular basis, the Company's accounting policies, assumptions, estimates and judgments in order to ensure

that the condensed interim consolidated financial statements are presented fairly and in accordance with IFRS. Revisions to accounting

estimates are recognized in the period in which the estimates are revised and in any future periods affected.

accounting estimates and assumptions, as well as critical judgments used in applying accounting policies in the preparation of

the Company's condensed interim consolidated financial statements, were the same as those found in note 4 to the Company's

annual consolidated financial statements as of December 31, 2018 and 2017 and for the years ended December 31, 2018, and 2017

except for those related to the adoption of IFRS 16, as follows:

judgments in determining the lease term and discount rate

determining the lease term, management considers all facts and circumstances that create an economic incentive to exercise an

extension option, or not exercise a termination option. Extension options (or periods after termination options) are only included

in the lease term if the lease is reasonably certain to be extended (or not terminated).