COSCIENS Biopharma (CSCI) gains from German exit but warns on going concern and customer risk
Rhea-AI Filing Summary
COSCIENS Biopharma Inc. reported Q1 2026 revenue of $1.9M, up from $1.4M a year earlier, with gross margin improving to 42% from 27%. Continuing operations posted a small net loss of $0.2M, but total net income was $10.8M driven by a $10.9M gain from discontinuing and deconsolidating its loss-making German biopharmaceutical subsidiaries after they filed for insolvency.
The German exit eliminated about $10.6M in unfunded pension obligations and leaves COSCIENS focused on its oat-derived active ingredients business. However, the company highlights material uncertainty about its ability to continue as a going concern, citing sustained revenue declines in prior periods, ongoing operating losses and reliance on one U.S. distributor that represented 84% of Q1 2026 revenue and 86% of receivables.
At March 31, 2026, COSCIENS had cash of $5.0M, total assets of $18.8M and total liabilities sharply reduced to $3.5M, lifting shareholders’ equity to $15.3M from $3.8M at year-end 2025. Management is executing a cost-cutting plan, scaling back R&D and overheads, and expects existing cash and cash flows to fund operations for at least 12 months, while acknowledging that adverse developments could force further cuts.
The company is also pursuing a share reorganization to enable filing of Form 15-F and suspend SEC reporting obligations, while keeping its listing on the TSX and trading on the OTC Market and continuing to report under Canadian securities laws.
Positive
- None.
Negative
- Going concern uncertainty: The company discloses material uncertainty that raises substantial doubt about its ability to continue as a going concern, given sustained past losses, negative operating cash flow and reliance on projections.
- Business contraction and insolvency: German biopharmaceutical subsidiaries filed for insolvency and were deconsolidated, eliminating a segment but highlighting prior financial strain and reducing diversification.
- Customer concentration risk: One distributor accounted for 84% of Q1 2026 revenue and 86% of trade receivables, exposing COSCIENS to significant counterparty and volume risk.
- Ongoing cash burn: Continuing operations used $2.2M of cash in Q1 2026, while cash and cash equivalents declined to $5.0M from $7.3M at year-end 2025, limiting financial flexibility.
Insights
Accounting gain masks structural risk; going concern doubt is central.
COSCIENS delivered stronger Q1 2026 operations, with revenue up to $1.9M and gross margin at 42%. The headline net income of $10.8M is almost entirely from a one-time $10.9M gain on deconsolidating insolvent German subsidiaries and removing about $10.6M in unfunded pension liabilities.
Core continuing operations still lost $0.2M and used $2.2M of operating cash in the quarter. Management explicitly states there is material uncertainty that raises substantial doubt about the company’s ability to continue as a going concern, despite post-deconsolidation liabilities dropping to $3.5M and equity rising to $15.3M.
Risk is amplified by customer concentration: one U.S. distributor provided 84% of Q1 2026 revenue and 86% of receivables. Future performance depends on sustaining that relationship, executing cost reductions, and stabilizing cash flows. The planned suspension of U.S. SEC reporting via a share reorganization could reduce costs but may change how some investors access information; subsequent filings will show whether operational improvements offset these structural risks.
Key Figures
Key Terms
discontinued operations financial
going concern financial
unfunded pension liability financial
Rule 13e-3 Transaction Statement regulatory
PGX Technology technical
gross margin financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For
the month of May,
Commission
File Number:
(Translation of registrant’s name into English)
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
Forward-Looking Statements
The information in this Report on Form 6-K and the exhibits attached hereto and incorporated herein by reference include “forward-looking statements” as well as “forward-looking information” under the provisions of Canadian securities laws. All statements, other than statements of historical fact, that address circumstances, events, activities, or developments that could or may or will occur are forward-looking statements.
Specific forward-looking information in this document includes, but is not limited to, statements relating to: the implementation of the Share Capital Amendment (as defined below), the approval of the Toronto Stock Exchange (“TSX”) for the Share Capital Amendment, the timing and ability of the Corporation to complete the SEC Reporting Suspension (as defined below), the expected cost savings to the Corporation from completing the Share Capital Amendment and the SEC Reporting Suspension, the ability of the Corporation to comply with Rule 12g3-2(b) following completion of the Share Capital Amendment, the anticipated effect of the Share Capital Amendment on the price of the Corporation’s Common Shares, the Corporation’s ability to continue to meet its public reporting obligations as a “reporting issuer” under applicable Canadian securities laws and the Corporation’s expected cost savings from the insolvency of its German subsidiaries. When used in this Report on Form 6-K and the exhibit attached hereto and incorporate herein by reference, words such as “anticipate”, “assume”, “believe”, “could”, “expect”, “forecast”, “future”, “goal”, “guidance”, “intend”, “likely”, “may”, “would” or the negative or comparable terminology as well as terms usually used in the future and the conditional are generally intended to identify forward-looking statements, although not all forward-looking statements include such words.
Forward-looking statements involve known and unknown risks and uncertainties, and other factors which may cause the actual results, performance or achievements stated herein to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such risks and uncertainties include those under the heading “Risk Factors” in the Company’s most recent Annual Report on Form 20-F and other public disclosure filed or furnished under our profile on SEDAR+ at www.sedarplus.ca. or to the Securities and Exchange Commission (“SEC”), including the Rule 13e-3 Transaction Statement on Schedule 13E-3, filed by the Company with the SEC on April 4, 2026, as amended.
Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. Many of these factors are beyond our control. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The Company does not undertake to update any forward-looking statements contained herein, except as required by applicable securities laws. New factors emerge from time to time, and it is not possible for the Company to predict all of these factors, or to assess in advance the impact of each such factor on the Company’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statement.
DOCUMENTS INDEX
| Exhibit | Description | |
| 99.1 | COSCIENS Biopharma Condensed Interim Consolidated Financial Statements – First Quarter 2026 (Q1) | |
| 99.2 | COSCIENS Biopharma Management’s Discussion and Analysis of Financial Condition and Results of Operations – First Quarter 2026 (Q1) | |
| 99.3 | Certification of the Chief Executive Officer pursuant to National Instrument 52-109 | |
| 99.4 | Certification of the Principal Financial Officer pursuant to National Instrument 52-109 |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| COSCIENS Biopharma Inc. | ||
| Date: May 12, 2026 | By: | /s/ Giuliano La Fratta |
| Name: | Giuliano La Fratta | |
| Title: | Chief Financial Officer | |
Exhibit 99.1
COSCIENS Biopharma Inc.
Condensed Interim Consolidated Financial Statements
As of March 31, 2026, and for the three months ended March 31, 2026, and 2025
(In thousands of US dollars)
(Unaudited)
| Condensed Interim Consolidated Statements of Financial Position | 2 |
| Condensed Interim Consolidated Statements of Changes in Shareholders’ Equity | 3 |
| Condensed Interim Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) | 4 |
| Condensed Interim Consolidated Statements of Cash Flows | 5 |
| Notes to the Condensed Interim Consolidated Financial Statements | 6 |
| 1 |
COSCIENS Biopharma Inc.
Condensed Interim Consolidated Statements of Financial Position
(In thousands of US dollars)
(Unaudited)
As of March 31, 2026 | As of December 31, 2025 | |||||||
| $ | $ | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | ||||||||
| Trade and other receivables | ||||||||
| Inventories (note 4) | ||||||||
| Prepaid expenses and other assets (note 5) | ||||||||
| Assets held for sale | ||||||||
| Total current assets | ||||||||
| Non-current assets | ||||||||
| Restricted cash and cash equivalents | ||||||||
| Deposits | ||||||||
| Property and equipment (note 6) | ||||||||
| Intangible assets | ||||||||
| Total non-current assets | ||||||||
| Total assets | ||||||||
| LIABILITIES | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued liabilities (note 7) | ||||||||
| Provisions | ||||||||
| Income taxes payable | ||||||||
| Current portion of lease liabilities | ||||||||
| Warrant liability (note 9) | ||||||||
| Total current liabilities | ||||||||
| Non-current liabilities | ||||||||
| Deferred revenues (note 3) | ||||||||
| Lease liabilities | ||||||||
| Employee future benefits (note 8) | ||||||||
| Total non-current liabilities | ||||||||
| Total liabilities | ||||||||
| Shareholders’ equity | ||||||||
| Share capital (note 10) | ||||||||
| 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/ Anthony J. Giovinazzo | |
| Peter H. Puccetti, Chair of the Board | Anthony J. Giovinazzo, Director |
| 2 |
COSCIENS Biopharma Inc.
Condensed Interim Consolidated Statements of Changes in Shareholders’ Equity
For the three months ended March 31, 2026, and 2025
(In thousands of US dollars)
(Unaudited)
| Share capital | Contributed surplus | Retained earnings | Accumulated other comprehensive loss | Total | ||||||||||||||||
| $ | $ | $ | $ | $ | ||||||||||||||||
| Balance – January 1, 2026 | ( | ) | ( | ) | ||||||||||||||||
| Net profit | ||||||||||||||||||||
| Other comprehensive loss: | ||||||||||||||||||||
| Foreign currency translation adjustments | ||||||||||||||||||||
| Comprehensive profit | ||||||||||||||||||||
| Share-based compensation costs | ||||||||||||||||||||
| Exercise of warrants | ||||||||||||||||||||
| Balance – March 31, 2026 | ( | ) | ( | ) | ||||||||||||||||
| 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 | ||||||||||||||||||||
| Comprehensive loss | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Share-based compensation costs | ||||||||||||||||||||
| Exercise of warrants | ||||||||||||||||||||
| Balance – March 31, 2025 | ( | ) | ( | ) | ||||||||||||||||
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
| 3 |
COSCIENS Biopharma Inc.
Condensed Interim Consolidated Statements of Income (Loss) and Comprehensive Income (Loss)
For the three months ended March 31, 2026, and 2025
(In thousands of US dollars, except share and per share data)
(Unaudited)
Three months ended March 31, | ||||||||
| 2026 | 2025 (Restated – Note 14) | |||||||
| $ | $ | |||||||
| Continuing operations | ||||||||
| Revenues (note 3) | ||||||||
| Cost of sales | ( | ) | ( | ) | ||||
| Gross profit | ||||||||
| Research and development | ( | ) | ( | ) | ||||
| Selling, general and administrative | ( | ) | ( | ) | ||||
| Total operating expenses | ( | ) | ( | ) | ||||
| Loss from continuing operations | ( | ) | ( | ) | ||||
| Foreign exchange gain (loss) | ( | ) | ||||||
| Finance costs | ( | ) | ( | ) | ||||
| Interest income | ||||||||
| Other income | ||||||||
| Change in fair value of warrant and DSU liabilities | ( | ) | ||||||
| Other income (loss) | ( | ) | ||||||
| Loss before income taxes from continuing operations | ( | ) | ( | ) | ||||
| Income tax recovery (expense) | ||||||||
| Net loss from continuing operations | ( | ) | ( | ) | ||||
| Discontinued operations | ||||||||
| Income (loss) from discontinued operations, net of tax (note 14) | ( | ) | ||||||
| Net income (loss) | ( | ) | ||||||
| Other comprehensive income (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 8) | ||||||||
| Comprehensive income (loss) | ( | ) | ||||||
| Basic and diluted loss per share from continuing operations (note 12) | ) | ) | ||||||
| Basic income (loss) per share (note 12) | ( | ) | ||||||
| Diluted income (loss) per share (note 12) | ( | ) | ||||||
| Weighted average number of shares outstanding (basic) | ||||||||
| Weighted average number of shares outstanding (diluted) | ||||||||
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
| 4 |
COSCIENS Biopharma Inc.
Condensed Interim Consolidated Statements of Cash Flows
For the three months ended March 31, 2026, and 2025
(In thousands of US dollars)
(Unaudited)
Three months ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| $ | $ | |||||||
| Cash flows from operating activities | ||||||||
| Net income (loss) for the period | ( | ) | ||||||
| Items not affecting cash and cash equivalents: | ||||||||
| Deconsolidation of German subsidiaries (note 14) | ( | ) | ||||||
| Depreciation and amortization | ||||||||
| Share-based compensation costs | ||||||||
| Loss on disposal of property and equipment | ||||||||
| Employee future benefits | ||||||||
| Amortization of deferred revenues | ( | ) | ||||||
| Change in fair value of warrant and DSU liabilities | ( | ) | ||||||
| Other non-cash items | ( | ) | ||||||
| Changes in operating assets and liabilities (note 11) | ( | ) | ||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash flows from financing activities | ||||||||
| Payments on lease liabilities | ( | ) | ( | ) | ||||
| Net cash used in financing activities | ( | ) | ( | ) | ||||
| Cash flows from investing activities | ||||||||
| Deconsolidation of German subsidiaries (note 14) | ( | ) | ||||||
| Purchase of property and equipment | ( | ) | ( | ) | ||||
| Proceeds on disposal of property and equipment | ||||||||
| Changes in restricted cash equivalents | ( | ) | ||||||
| Net cash 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.
Notes to the Condensed Interim Consolidated Financial Statements
As of March 31, 2026, and for the three months ended March 31, 2026, and 2025
(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. is a holding company, operating through its subsidiaries (collectively, the “Company”). COSCIENS’s principal operating subsidiary, Ceapro Inc. (“Ceapro”) is focused on the development and commercialization of natural, plant-based active ingredients derived from oats and other renewable plant resources, using proprietary manufacturing and extraction technologies. 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 May 12, 2026.
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.
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.
As
discussed in Note 6, the Company has experienced a sustained decline in revenues and has incurred continuous operating losses during
the current and prior fiscal period, raising substantial doubt about the Company’s ability to continue as a going concern. During
the three-month period ended March 31, 2026, the Company incurred a net loss from continuing operations of $
In
addition, a significant portion of the Company’s revenue is derived from a single customer primarily located in the United States
(Note 13), 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.
Notes to the Condensed Interim Consolidated Financial Statements
As of March 31, 2026, and for the three months ended March 31, 2026, and 2025
(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, 2025.
The accounting policies applied in these condensed interim consolidated financial statements are consistent with those presented in the Company’s annual consolidated financial statements for the year ended December 31, 2025, except as noted below.
Discontinued operations
A discontinued operation is a component of the Group’s business, the operations and cash flows of which can be clearly distinguished from the rest of the Group and which represents a separate major line of business or geographical area of operations and is part of a single coordinated plan to dispose of a separate major line of business or geographical area of operations.
Classification as a discontinued operation is assessed at the earlier of disposal or when the operation meets the criteria to be classified as held-for-sale. The German subsidiaries met the definition of a discontinued operation on March 27, 2026, following their deconsolidation. As these entities comprised the Company’s Biopharmaceutical segment, they represent a separate major line of business.
When an operation is classified as a discontinued operation, the comparative consolidated statement of profit or loss and other comprehensive income is presented as if the operation had been discontinued from the start of the comparative year.
| 7 |
COSCIENS Biopharma Inc.
Notes to the Condensed Interim Consolidated Financial Statements
As of March 31, 2026, and for the three months ended March 31, 2026, and 2025
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
Loss of control
When the Company loses control over a subsidiary, it derecognizes the assets and liabilities of the subsidiary, and other components of equity. Any resulting gain or loss is recognized in the consolidated statement of income (loss).
New standards and amendments
Several amendments apply for the first time for reporting periods beginning after January 1, 2026, but do not have a significant 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, 2025, other than the following:
Loss of control
The Company is required to make judgments in assessing whether the Company has lost control over a subsidiary. In making this assessment, the Company assesses whether it has power by determining whether its substantive rights to direct the relevant activities of the subsidiary are suspended due to the insolvency proceedings and who holds such substantive rights.
| 8 |
COSCIENS Biopharma Inc.
Notes to the Condensed Interim Consolidated Financial Statements
As of March 31, 2026, and for the three months ended March 31, 2026, and 2025
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| 3. | Revenue |
The Company derives revenue from active ingredient product sales at a point in time.
Deferred revenue
The deferred revenue balance as at December 31, 2025 primarily relates to the advance consideration received by AEZS Germany 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. As described in Note 15, as of March 27, 2026, the Company ceased to consolidate AEZS Germany and the deferred revenue related to the Pharmanovia and NK Meditech Limited customers was derecognized.
For
the three months ended March 31, 2026, the Company recognized $
Liabilities related to contracts with customers
The following table provides a summary of deferred revenue balances:
| December 31, 2025 | ||||||||||||
| Current | Non-Current | Total | ||||||||||
| $ | $ | $ | ||||||||||
| Pharmanovia | ||||||||||||
| NK Meditech Limited | ||||||||||||
| Davimed GmbH | ||||||||||||
| 4. | Inventories |
The Company had the following inventories at the end of each reporting period:
| March 31, 2026 | December 31, 2025 | |||||||
| $ | $ | |||||||
| Raw materials | ||||||||
| Work in progress | ||||||||
| Finished goods | ||||||||
Inventories
expensed to cost of goods sold during the three-month period ended March 31, 2026, were $
| 5. | Prepaid expenses and other assets |
The Company had the following prepaid expenses at the end of each reporting period:
| March 31, 2026 | December 31, 2025 | |||||||
| $ | $ | |||||||
| Prepaid insurance | ||||||||
| Prepaid research and development | ||||||||
| Other | ||||||||
| 9 |
COSCIENS Biopharma Inc.
Notes to the Condensed Interim Consolidated Financial Statements
As of March 31, 2026, and for the three months ended March 31, 2026, and 2025
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| 6. | 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, 2025 | ||||||||||||||||||||||||
| Additions | ||||||||||||||||||||||||
| Impairment | ( | ) | ( | ) | ||||||||||||||||||||
| Disposals | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Impact of foreign exchange rate changes | ||||||||||||||||||||||||
| At December 31, 2025 | ||||||||||||||||||||||||
| Amounts derecognized due to discontinued operations | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||
| Additions | ||||||||||||||||||||||||
| Disposals | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Commissioning of assets | ( | ) | ||||||||||||||||||||||
| Impact of foreign exchange rate changes | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||
| At March 31, 2026 | ||||||||||||||||||||||||
| Accumulated Depreciation | ||||||||||||||||||||||||
| Equipment Not Available for Use | Equipment | Office and Computer Equipment | Buildings | Leasehold Improvements | Total | |||||||||||||||||||
| $ | $ | $ | $ | $ | $ | |||||||||||||||||||
| At January 1, 2025 | ||||||||||||||||||||||||
| Amortization | ||||||||||||||||||||||||
| Disposals | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||
| Impact of foreign exchange rate changes | ||||||||||||||||||||||||
| At December 31, 2025 | ||||||||||||||||||||||||
| Amounts derecognized due to deconsolidation of German subsidiaries | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||
| Amortization | ||||||||||||||||||||||||
| Disposals | ( | ) | ( | ) | ||||||||||||||||||||
| Impact of foreign exchange rate changes | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||
| At March 31, 2026 | ||||||||||||||||||||||||
| Carrying amount | ||||||||||||||||||||||||
| Equipment Not Available for Use | Equipment | Office and Computer Equipment | Buildings | Leasehold Improvements | Total | |||||||||||||||||||
| $ | $ | $ | $ | $ | $ | |||||||||||||||||||
| At December 31, 2025 | ||||||||||||||||||||||||
| At March 31, 2026 | ||||||||||||||||||||||||
| 10 |
COSCIENS Biopharma Inc.
Notes to the Condensed Interim Consolidated Financial Statements
As of March 31, 2026, and for the three months ended March 31, 2026, and 2025
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
During
the three-month period ended March 31, 2026 the Company retired fully depreciated assets no longer in use of $ (2025 - $
Included
in the net carrying amount of property and equipment at March 31, 2026, are right-of-use assets relating to buildings, in the amount
of $
As
of March 31, 2026, the market capitalization of the Company is lower than its carrying amount and the Active Ingredient CGU will absorb
more corporate costs following the deconsolidation of the Biopharmaceutical CGU, suggesting potential impairment. As a result, the Company
tested the Active Ingredient CGU for impairment and the recoverable amount was estimated based on its value in use, using a discounted
cash flow model. 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 and discount
rate. As at March 31, 2026,
| 7. | Accounts payable and accrued liabilities |
The Company had the following accounts payable and accrued expenses at the end of each reporting period:
| March 31, 2026 | December 31, 2025 | |||||||
| $ | $ | |||||||
| Trade accounts payable | ||||||||
| Accrued research and development costs | ||||||||
| Accrued employee benefits | ||||||||
| Payroll tax and other statutory liabilities | ( | ) | ||||||
| Other accrued liabilities | ||||||||
| 11 |
COSCIENS Biopharma Inc.
Notes to the Condensed Interim Consolidated Financial Statements
As of March 31, 2026, and for the three months ended March 31, 2026, and 2025
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| 8. | Employee future benefits |
The change in the Company’s employee future benefit obligations is summarized as follows:
Three months ended March 31, 2026 | Year ended December 31, 2025 | |||||||||||||||
| 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 | ||||||||||||||||
| Deconsolidation of German subsidiaries | ( | ) | ( | ) | ( | ) | ||||||||||
| 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 | ||||||||||||||||
| Deconsolidation of German subsidiaries | ( | ) | ( | ) | ||||||||||||
| 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.
| 12 |
COSCIENS Biopharma Inc.
Notes to the Condensed Interim Consolidated Financial Statements
As of March 31, 2026, and for the three months ended March 31, 2026, and 2025
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| 9. | Warrants |
Warrant activity for the three months ended March 31, 2026, was as follows:
| Warrants | Weighted average exercise price | Amount | ||||||||||
| # | $ | $ | ||||||||||
| Balance – December 31, 2025 | ||||||||||||
| Exercised | ( | ) | ( | ) | ||||||||
| Expired | ( | ) | ||||||||||
| Change in fair value of warrants | ( | ) | ||||||||||
| Balance – March 31, 2026 | ||||||||||||
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 March 31, 2026, the following warrants were outstanding:
| Issuance date | Number | Weighted average remaining contractual life | Weighted average exercise price | |||||||||
| # | years | $ | ||||||||||
| June 2024 | ||||||||||||
| Balance – March 31, 2026 | ||||||||||||
| 10. | 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.
| Common shares | Amount | |||||||
| # | $ | |||||||
| Balance – December 31, 2025 | ||||||||
| Granted | ||||||||
| Balance – March 31, 2026 | 22,625 | |||||||
| Common shares | Amount | |||||||
| # | $ | |||||||
| Balance – December 31, 2024 | ||||||||
| Granted | ||||||||
| Balance – March 31, 2025 | ||||||||
| 13 |
COSCIENS Biopharma Inc.
Notes to the Condensed Interim Consolidated Financial Statements
As of March 31, 2026, and for the three months ended March 31, 2026, and 2025
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
Share-based compensation
The
compensation expense for the three months ended March 31, 2026, was $
| Stock options | Weighted average exercise price | |||||||
| # | $ | |||||||
| Balance – January 1, 2026 | ||||||||
| Cancelled / Forfeited | ( | ) | ( | ) | ||||
| Balance – March 31, 2026 | ||||||||
| Stock options | Weighted average exercise price | |||||||
| # | $ | |||||||
| Balance – January 1, 2025 | ||||||||
| Cancelled / Forfeited | ( | ) | ||||||
| Balance – March 31, 2025 | ||||||||
| 11. | Supplemental disclosure of cash flow information |
Three months ended March 31 | ||||||||
| 2026 | 2025 | |||||||
| $ | $ | |||||||
| 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 | ( | ) | ( | ) | ||||
| ( | ) | |||||||
| 14 |
COSCIENS Biopharma Inc.
Notes to the Condensed Interim Consolidated Financial Statements
As of March 31, 2026, and for the three months ended March 31, 2026, and 2025
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
| 12. | Net income (loss) per share |
Three months ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| $ | $ | |||||||
| Net loss from continuing operations | ( | ) | ( | ) | ||||
| Net income (loss) | ( | ) | ||||||
| Weighted-average shares outstanding (basic) | ||||||||
| Weighted-average shares outstanding (diluted) | ||||||||
| Basic and diluted loss per share from continuing operations | ) | ) | ||||||
| Basic income (loss) per share | ( | ) | ||||||
| Diluted income (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 | ||||||||
| 13. | Segment information |
The Company’s chief operating decision maker assesses the performance 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. As of December 31, 2025, the Company had two reportable and operating segments: Active ingredient and Biopharmaceutical.
As described in Note 14, as of March 27, 2026, the Company ceased to consolidate the German subsidiaries, which composed the Biopharmaceutical segment. Therefore, as of March 31, 2026, the Company has one reportable and operating segment, Active ingredient, involved in 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.
Major Customer
During
the three months ended March 31, 2026, the Company had export sales to one major distributor of the Company’s products representing
| 14. | Discontinued operations |
On March 5, 2026, the Company announced the strategic decision to cease funding its German subsidiaries. As a result, on March 23, 2026, the German subsidiaries filed an insolvency petition at a German Court to open insolvency proceedings. Effective on March 27, 2026, following the appointment of an insolvency administrator, the Company ceased to consolidate the German subsidiaries as the Company was no longer in a position of control over the German subsidiaries.
As
described in Note 13, the German subsidiaries constituted the Biopharmaceutical segment of the Company. The segment involved the commercializing
and developing pharmaceutical therapeutics and diagnostic tests, including the Company’s lead product, Macrilen®
(macimorelin). The segment also included 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. Accordingly, the Company derecognized the assets
and liabilities of the German subsidiaries from its consolidated balance sheet which resulted in a total income from discontinued operations
of $
| 15 |
COSCIENS Biopharma Inc.
Notes to the Condensed Interim Consolidated Financial Statements
As of March 31, 2026, and for the three months ended March 31, 2026, and 2025
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
The following tables summarize the financial information related to the German subsidiaries on March 27, 2026, which was immediately prior to deconsolidation:
As of March 27, 2026 | ||||
| $ | ||||
| ASSETS | ||||
| Current assets | ||||
| Cash and cash equivalents | ||||
| Trade and other receivables | ||||
| Inventories | ||||
| Prepaid expenses and other assets | ||||
| Total current assets | ||||
| Non-current assets | ||||
| Restricted cash and cash equivalents | ||||
| Property and equipment (note 6) | ||||
| Total non-current assets | ||||
| Total assets | ||||
| LIABILITIES | ||||
| Current liabilities | ||||
| Accounts payable and accrued liabilities | ( | ) | ||
| Provisions | ( | ) | ||
| Income taxes payable | ( | ) | ||
| Current portion of lease liabilities | ( | ) | ||
| Total current liabilities | ( | ) | ||
| Non-current liabilities | ||||
| Deferred revenues (note 3) | ( | ) | ||
| Lease liabilities | ( | ) | ||
| Employee future benefits (note 8) | ( | ) | ||
| Total non-current liabilities | ( | ) | ||
| Total liabilities | ( | ) | ||
| Total net liabilities | ( | ) | ||
| $ | ||||
| Carrying amount of net liabilities deconsolidated | ( | ) | ||
| Reclassification of foreign currency translation adjustments | ||||
| Gain on deconsolidation | ||||
| 16 |
COSCIENS Biopharma Inc.
Notes to the Condensed Interim Consolidated Financial Statements
As of March 31, 2026, and for the three months ended March 31, 2026, and 2025
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
The key components of the operating results of the discontinued operations for the German subsidiaries are as follows:
Three months ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| $ | $ | |||||||
| Revenues | ||||||||
| Cost of sales | ( | ) | ( | ) | ||||
| Gross profit | ||||||||
| Research and development | ||||||||
| Selling, general and administrative | ||||||||
| Total operating expenses | ||||||||
| Loss from operations | ( | ) | ( | ) | ||||
| Foreign exchange gain (loss) | ( | ) | ||||||
| Finance costs | ( | ) | ( | ) | ||||
| Other income | ||||||||
| Net loss from discontinued operations | ( | ) | ( | ) | ||||
| Gain on deconsolidation | ||||||||
| Income (loss) from discontinued operations, net of tax | ( | ) | ||||||
| Basic income (loss) per share (note 12) | ( | ) | ||||||
| Diluted income (loss) per share (note 12) | ( | ) | ||||||
| 17 |
COSCIENS Biopharma Inc.
Notes to the Condensed Interim Consolidated Financial Statements
As of March 31, 2026, and for the three months ended March 31, 2026, and 2025
(In thousands of US dollars, except share and per share data and as otherwise noted)
(Unaudited)
Cash flows provided by (used in) discontinued operations were:
Three months ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| $ | $ | |||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Net cash used in financing activities | ||||||||
| Net cash provided by 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 | ||||||||
| 15. | Commitments and Contingencies |
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
| 18 |
Exhibit 99.2
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Introduction
This Management’s Discussion and Analysis (“MD&A”) provides a review of the results of operations, financial condition and cash flows of COSCIENS Biopharma Inc. for the three months ended March 31, 2026. In this MD&A, “COSCIENS”, the “Company”, “we”, “us” and “our” mean COSCIENS Biopharma Inc. and its subsidiaries. This discussion should be read in conjunction with the information contained in the Company’s unaudited interim condensed consolidated financial statements (the “interim consolidated financial statements”) and the notes thereto as of March 31, 2026 and December 31, 2025, and for the three months ended March 31, 2026 and 2025. Our unaudited interim consolidated financial statements have been prepared in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board (“IFRS”). This material, and additional information about the Company, is available on SEDAR+ at www.sedarplus.com, on EDGAR at www.sec.gov/edgar and on the Company’s website at www.cosciensbio.com.
All amounts in this MD&A are presented in thousands of United States (“U.S.”) dollars, except for share and per share data, or as otherwise noted. This MD&A was approved by the Company’s Board of Directors (the “Board”) on, and is dated, May 12, 2026.
About Forward-Looking Statements
Certain statements in this MD&A, referred to herein as “forward-looking statements”, constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995, as amended, and “forward-looking information” under the provisions of Canadian securities laws. All statements included in or incorporated by reference into this MD&A, other than statements of historical fact, that address circumstances, events, activities, or developments that could or may or will occur are forward-looking statements. When used in this MD&A, and the documents incorporated herein by reference, words such as “anticipate”, “assume”, “believe”, “could”, “expect”, “forecast”, “future”, “goal”, “guidance”, “intend”, “likely”, “may”, “would” or the negative or comparable terminology as well as terms usually used in the future and the conditional are generally intended to identify forward-looking statements, although not all forward-looking statements include such words. Specific forward-looking statements in this MD&A and the documents incorporated herein by reference include, but are not limited to, statements relating to: the Company’s patented technologies and value-driving products, and development thereof; the extraction, production and commercialization of active ingredients from natural sources and our ability to successfully market related products; the successful development and marketing of our oat-based pipeline products, including oat-beta glucan, avenanthramides and beta glucan from yeast, as well as the capability of such products to address unmet needs within the nutraceuticals market; the Company’s business strategy; the Company’s positioning in its target markets; the Company’s ability to accelerate the scale-up of PGX Technology towards commercial levels; management’s assumptions, estimates and judgements; liquidity and capital resources; adequacy of our financial resources to finance operations and expenditure requirements; our ability to maintain an effective system of internal controls; the ability of the Company to suspend its reporting obligations under applicable U.S. securities laws; and the plans, objectives, future outlook and financial position of the Company in general. All forward-looking statements are given pursuant to the “safe harbour” provisions of applicable securities legislation.
The forecasts and projections that make up the forward-looking statements contained herein are based on the Company’s current expectations and assumptions, including factors or assumptions that were applied in drawing a conclusion or making a forecast or projection, and including, but not limited to assumptions based on historical trends, current conditions, and expected future developments, and assumptions regarding: the ability of the Company to suspend its U.S. reporting obligations in a timely manner; the ability of the Company to execute on its strategic plans and find new customers and partners in connection therewith; the successful development of technologies and value-driving products; the extraction, production and commercialization of active ingredients from natural sources and our ability to successfully market related products; the ability to source the raw materials required to develop our oat-based products; the successful development and marketing of our pipeline products as well as such products’ capability to address unmet needs within new markets; the Company’s business strategy; the Company’s positioning in its target markets; the impact of tariffs and other trade barriers, on our costs and revenues, as well as on the macroeconomic framework in which we operate; the Company’s plans for its PGX Technology; the adequacy of our financial resources to finance operations and expenditure requirements; our ability to seek additional financing to fund our business activities in the future; and the plans, objectives, future outlook and financial position of the Company in general.
| 1 |
Forward-looking statements involve known and unknown risks and uncertainties, and other factors which may cause the actual results, performance or achievements stated herein to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others: the Company’s present and future business strategies as described herein may not have the expected or desired results in the short-term or long-term; our revenues and expenses may fluctuate significantly, and we may fail to meet financial expectations; the Company’s ability to continue as a going concern; operations and performance within expected ranges; anticipated future cash flows; local and global economic conditions and the environment in which the Company operates the imposition of duties and tariffs and other trade barriers and retaliatory countermeasures implemented by the U.S. and other governments could have a material adverse effect on our business, financial condition and results of operations; anticipated capital and operating costs; uncertainty in our revenue generation from our marketed products; product development and related validation studies; results from our products under development may not be successful or may not support advancing the product; our now heavy dependence on sales by and revenue from our main distributor of active ingredients and its customers; the continued availability of funds and resources to successfully commercialize our products; the ability to secure strategic partners for late stage development, marketing, and distribution of our products; our ability to protect and enforce our patent portfolio and intellectual property; our ability to continue to list our common shares on the Toronto Stock Exchange (the “TSX”); the continued trading and liquidity of our common shares on the OTCQB® Venture Market (the “OTC Market”); and our ability to suspend our reporting obligations under, the Securities Exchange Act of 1934 (“Exchange Act”), and to realize any projected cost savings therefrom, as well as any impact on the trading of our common shares as a result thereof.
More detailed information about these and other factors is included under “Risk Factors” in the Annual Report on Form 20-F and in other documents furnished to the U.S. Securities and Exchange Commission (the “SEC”) and in our other public disclosure filed under our profile on SEDAR+ at www.sedarplus.ca.
Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. Many of these factors are beyond our control. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements, particularly in light of any resulting impacts on the global economy and on the Company’s business. Accordingly, readers should not place undue reliance on forward-looking statements. The Company does not undertake to update any forward-looking statements contained herein, except as required by applicable securities laws. New factors emerge from time to time, and it is not possible for the Company to predict all of these factors, or to assess in advance the impact of each such factor on the Company’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statement.
Company Overview
COSCIENS Biopharma Inc. is a holding company, operating through its subsidiaries (collectively, the “Company”). COSCIENS’s principal operating subsidiary, Ceapro Inc. (“Ceapro”) is focused on the development and commercialization of natural, plant-based active ingredients derived from oats and other renewable plant resources, using proprietary manufacturing and extraction technologies. Ceapro’s primary active ingredient business activities relate to the development and commercialization of natural products for the personal care, cosmetic, human and animal health industries using proprietary technology, natural, renewable resources and developing innovative products, technologies and delivery systems.The Company’s common shares are listed on the TSX under the symbol “CSCI” and are listed and posted for trading on the OTC Market under the symbol “CSCI.F”.
| 2 |
Recent Developments/Updates
Wind-Down of Biopharmaceutical Business
On March 5, 2026, the Company announced the strategic decision to cease funding its German subsidiaries, AEZS Germany, and its wholly owned subsidiary Zentaris IVF GmbH. On March 23, 2026, the German subsidiaries filed an insolvency petition at a German Court to open insolvency proceedings and, effective on March 27, 2026, following the appointment of a preliminary insolvency administrator, the Company ceased to exercise control over the entities. Accordingly, the Company derecognized the assets and liabilities of these entities from its consolidated balance sheet which resulted in a total income from discontinued operations of $10.9 million for the three months ending March 31, 2026, primarily the result of no longer recognizing the liability for employee future benefits resulting from unfunded pension liability associated with the German subsidiaries, which as of March 27, 2026 was $10.6 million. Effective March 27, 2026, the date of the loss of control, the results of the German subsidiaries met the definition of discontinued operations, and the results have been presented as such, including the prior year comparatives being restated.
The discontinued operations operated as a distinct segment and had no impact on the operations of the active ingredients operating segment. This MD&A reflects the results of continuing operations, unless otherwise noted.
Plan to Suspend SEC Reporting Obligations
On April 20, 2026 the Company announced that it had filed a Rule 13e-3 Transaction Statement on Schedule 13E-3 with the SEC in connection with a proposed share reorganization (involving a share consolidation and subsequent share split). Approval of the transaction by regulators and ultimately by Company shareholders would enable the Company to file a Form 15-F with the SEC with the intention of suspending the Company’s public reporting obligations under the Exchange Act, including the Corporation’s obligations to file and submit annual reports on Form 20-F and reports on Form 6-K with the SEC. The Company has now set June 17, 2026 as the date for its annual general and special meeting, at which, among other things, the proposed share reorganization will be considered by Company shareholders. The Company expects to mail shareholders a notice of meeting along with a management proxy circular later this month containing detailed information regarding the meeting and the proposed share reorganization.
For greater certainty, the Company intends to remain listed on the TSX, continue to have its Common Shares posted for trading on the OTC Market, and continue to meet its public reporting obligations as a “reporting issuer” under applicable Canadian securities laws, including by filing its continuous disclosure documents on its profile on SEDAR+ at www.sedarplus.ca.
Active Ingredients Business
The Company’s primary source of business stems from a commercial line of natural active ingredients including beta glucan, avenanthramides (colloidal oat extract), oat powder, oat oil, and oat peptides, which are marketed to the personal care, cosmetic, medical, and animal health industries through our distribution partners and direct sales. A small portion of current revenues represent veterinary therapeutic products, including an oat shampoo, an ear cleanser, and a dermal complex/conditioner, which are manufactured and marketed to veterinarians in Japan and other countries in Asia. The Company’s primary marketing strategy is to sell principally through a distribution network instead of selling directly to end-users and as a result sales and marketing expenses are negligible.
Over the last decade, the Company’s development projects in the active ingredients space have focused on its expertise in oats, which have a host of well-documented health care benefits, and on developing new innovative natural health care products or technologies. The Company also continues to explore opportunities for expansion into new product applications and categories, including as discussed below.
| 3 |
Technology
The active ingredient product technology industry 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 resources for the healthcare and cosmetic industries. These and similar manufactured products are sold primarily through distribution networks.
The Company’s core technologies used to extract and process bio actives include proprietary Ethanol Fractionation Processes (EFP) and Pressurized Gas eXpanded (PGX) Technology. EFP is currently used to produce the Company’s products for the active ingredient business. The Company also has a license for the PGX Technology, which is a patented, unique technology which simultaneously purifies, micronizes, dries, and combines aqueous solutions of biopolymers into fine structured open porous materials with unique morphologies using carbon dioxide (CO2) and food grade ethanol at mild temperatures. PGX has several key advantages over conventional drying and purification technologies that can be used to process biopolymers into high-value and novel biocomposites. In a single step and using green solvents, it has the ability to generate purified, highly porous polymer composites such as aerogels which cannot be made using conventional drying technologies. The moderate PGX processing conditions minimizes any potential degradation. The PGX drying process can also reduce the required carbon footprint, increase product shelf-life and lead to novel high value products including functional foods, nutraceuticals, cosmeceuticals and pharmaceuticals.
In 2023, the Company commenced a collaboration with Austria-based NATEX Prozesstechnologie GesmbH to accelerate the scale-up of PGX Technology at both its Edmonton facility and at the Natex Termitz facility in Austria. Construction and technical validation of both facilities is now complete.
The Company is accelerating development and commercialization efforts for its patented PGX Technology. Although these commercialization efforts are still in the early stages, the Company has begun engaging potential industry partners to demonstrate both its ability to produce specialty materials directly and its capacity to provide PGX Technology for integration into its partners’ own production operations.
The Company acknowledges that uncertainty remains regarding the ability of the Company to successfully commercialize PGX Technology, and that it is not yet generating revenue from this platform. Nevertheless, the Company remains firmly committed to advancing its development. The Company continues to engage with potential industry partners and government agencies to support the creation of new PGX applications and to drive the ongoing commercial progression of this unique technology.
AvenActive Clinical Trial
As previously announced, the Phase 2a study evaluating avenanthramides, for potential applications in managing conditions related to inflammation (“AvenActive”), which involved a total of 20 patients and was designed to gather information on safety, pharmacokinetics and initial signs of activity, concluded in Q3 2025. The complete study results were provided to the Company at the end of March 2026.
Exploratory analyses in participants with elevated cardiometabolic risk showed descriptive changes from baseline in inflammatory biomarkers at the 480 mg BID dose; however, due to the exploratory nature of the study, small sample sizes, and variability in responses, the placebo-adjusted differences were found to be not statistically significant, and all findings were considered hypothesis-generating only.
Progression of the program would require additional clinical studies to confirm efficacy signals, as well as further resolution of analytical limitations related to certain avenanthramide components. After evaluating the totality of the available data, anticipated development costs, technical considerations, and strategic priorities, the Company has determined not to advance the AvenActive program into further stages of research or clinical development at this time.
| 4 |
Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) 1
| (in thousands of US dollars, except loss per share) | Three months ended March 31, | |||||||
| 2026 | 2025 | |||||||
| $ | $ | |||||||
| Revenues | 1,888 | 1,387 | ||||||
| Cost of sales | (1,095 | ) | (1,018 | ) | ||||
| Gross profit | 793 | 369 | ||||||
| Research and development | (176 | ) | (497 | ) | ||||
| Selling, general and administrative | (1,347 | ) | (2,531 | ) | ||||
| Loss from continuing operations | (730 | ) | (2,659 | ) | ||||
| Other income (loss) | 547 | (15 | ) | |||||
| Loss before income taxes from continuing operations | (183 | ) | (2,674 | ) | ||||
| Income tax recovery | - | - | ||||||
| Net loss from continuing operations | (183 | ) | (2,674 | ) | ||||
| Income (loss) from discontinued operations, net of tax | 10,940 | (981 | ) | |||||
| Net income (loss)2 | 10,757 | (3,655 | ) | |||||
| Other comprehensive income (loss): 2 | ||||||||
| Items that may be reclassified subsequently to profit or loss: | ||||||||
| Foreign currency translation adjustments | 718 | (496 | ) | |||||
| Items that will not be reclassified subsequently to profit or loss: | ||||||||
| Actuarial gain on defined benefit plans | - | 1,110 | ||||||
| Comprehensive income (loss) 2 | 11,475 | (3,041 | ) | |||||
| Basic and diluted loss per share from continuing operations | (0.06 | ) | (0.85 | ) | ||||
| Basic income (loss) per share | 3.42 | (1.16 | ) | |||||
| Diluted income (loss) per share | 2.90 | (1.16 | ) | |||||
| Weighted average number of shares outstanding (basic) | 3,140,975 | 3,144,682 | ||||||
| Weighted average number of shares outstanding (diluted) | 3,713,817 | 3,144,682 | ||||||
1 Reflects only continuing operations unless otherwise noted
2 Includes continuing and discontinued operations
| 5 |
Revenue and cost of sales
The Company derives revenue from active ingredient product sales at a point in time. The following table summarizes our gross margin earned during the periods indicated (excluding discontinued operations):
| (in thousands of US dollars, except percentages) | Three months ended March 31, | |||||||||||||||
| 2026 | 2025 | Change | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Revenues | 1,888 | 1,387 | 501 | 36 | % | |||||||||||
| Cost of sales | 1,095 | 1,018 | 77 | 8 | % | |||||||||||
| Gross Margin | 793 | 369 | 424 | 115 | % | |||||||||||
| Gross Margin % | 42 | % | 27 | % | ||||||||||||
Our total revenue and cost of sales for our continuing operations for the three-month period ended March 31, 2026, were $1.9 million and $1.1 million respectively as compared to $1.4 million and $1 million, respectively, for the same period in 2025. This represents a gross margin of $0.8 million for the three-month period ended March 31, 2026 as compared to $0.4 million for the same period in 2025. These increases are primarily due to higher sales volumes during the period, as well as production inefficiencies in the prior period.
Research and development expenses
The following table summarizes our research and development expenses incurred during the periods indicated (excluding discontinued operations):
| (in thousands of US dollars, except percentages) | Three months ended March 31, | |||||||||||||||
| 2026 | 2025 | Change | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Direct research and development expenses: | ||||||||||||||||
| Avenanthramides for inflammation-based diseases | 63 | 311 | (248 | ) | (80 | )% | ||||||||||
| Other programs | 10 | 38 | (28 | ) | (74 | )% | ||||||||||
| Subtotal | 73 | 349 | (276 | ) | (79 | )% | ||||||||||
| Employee-related expenses | 77 | 140 | (63 | ) | (45 | )% | ||||||||||
| Facilities, depreciation, and other expenses | 26 | 8 | 18 | 225 | % | |||||||||||
| Total | 176 | 497 | (321 | ) | (65 | )% | ||||||||||
Our total research & development expenses for our continuing operations for the three-month period ended March 31, 2026, were $0.2 million as compared to $0.5 million for the same period in 2025, a decrease of $0.3 million. This decrease is primarily due to decreased spending on phase 1-2a clinical study on avenanthramides for inflammation-based diseases, as well as reductions in employee-related expenses primarily attributable to the restructuring that took place during the prior period.
| 6 |
Selling, general and administrative expenses
The following table summarizes our Selling, general and administrative expenses incurred during the period indicated (excluding discontinuing operations):
| (in thousands of US dollars, except percentages) | Three months ended March 31, | |||||||||||||||
| 2026 | 2025 | Change | Change | |||||||||||||
| $ | $ | $ | % | |||||||||||||
| Selling, general and administrative expenses: | ||||||||||||||||
| Salaries & benefits | 442 | 1,016 | (574 | ) | (56 | )% | ||||||||||
| Insurance | 192 | 284 | (92 | ) | (32 | )% | ||||||||||
| Professional fees | 445 | 548 | (103 | ) | (19 | )% | ||||||||||
| Other office & general expenses | 268 | 683 | (415 | ) | (61 | )% | ||||||||||
| Total selling, general and administrative expenses | 1,347 | 2,531 | (1,184 | ) | (47 | )% | ||||||||||
Our total selling, general and administrative expenses for our continuing operations for the three-month period ended March 31, 2026, were $1.3 million as compared to $2.5 million for the same period in 2025, a decrease of $1.2 million. This was primarily attributable to lower salaries & benefits expenses due to a reduction in employee headcount and lower other office & general expenses resulting from cost-saving initiatives undertaken throughout the second half of 2025 that reduced costs such as travel, consulting fees, and office supplies.
Other income (loss)
For the three-month period ended March 31, 2026, our net other income for our continuing operations was $0.5 million as compared to net other loss of $0.1 million for the three-month period ended March 31, 2025, an increase of $0.6 million attributable to the reduction in the fair value of warrant and DSU liabilities.
Net income (loss)
For the three-month period ended March 31, 2026, we reported consolidated net income of $10.8 million or $3.42 basic net income per common share, as compared with a consolidated net loss of $3.7 million, or $1.16 loss per common share for the same period in 2025. The $14.4 million increase in net income is primarily attributable to the increase of $10.9 million on the income from discontinued operations due to the deconsolidation of AEZS Germany and its wholly owned subsidiary Zentaris IVF GmbH as at March 27, 2026 (which, was primarily the result of no longer recognizing the liability for employee future benefits resulting from unfunded pension liability associated with the German subsidiaries, which as of March 27, 2026 was $10.6 million).
For the three-month period ended March 31, 2026, we reported consolidated net loss from continuing operations of $0.2 million or $0.06 net loss per common share as compared to $2.7 million or $0.85 respectively for the same period in 2025. The $2.5 million decrease in net loss is primarily attributable to:
| ● | a decrease in total operating expenses of $1.5 million from decreases in both research and development and selling, general and administrative expenses as discussed above; | |
| ● | an increase in other income of $0.6 million as discussed above; and | |
| ● | an increase in gross margin of $0.4 million from increased sales volumes and production efficiencies as discussed above. |
| 7 |
Selected quarterly financial data(1)
| Three months ended | ||||||||||||||||
| (in thousands of US dollars, except for per share data) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | ||||||||||||
| $ | $ | $ | ||||||||||||||
| Revenues | 1,888 | 1,766 | 1,483 | 2,749 | ||||||||||||
| Net income (loss) | 10,757 | (2,183 | ) | (1,819 | ) | (2,701 | ) | |||||||||
| Net income (loss) per share (basic) (2) | 3.42 | (0.69 | ) | (0.57 | ) | (0.85 | ) | |||||||||
| Net income (loss) per share (diluted) (2) | 2.90 | (0.69 | ) | (0.57 | ) | (0.85 | ) | |||||||||
| Three months ended | ||||||||||||||||
| (in thousands of US dollars, except for per share data) | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | ||||||||||||
| $ | $ | $ | ||||||||||||||
| Revenues | 1,500 | 3,322 | 1,871 | 2,337 | ||||||||||||
| Net loss | (3,655 | ) | (6,731 | ) | (5,755 | ) | (1,422 | ) | ||||||||
| Net loss per share (basic) (2) | (1.16 | ) | (2.15 | ) | (1.85 | ) | (0.64 | ) | ||||||||
| Net loss per share (diluted) (2) | (1.16 | ) | (2.15 | ) | (1.85 | ) | (0.64 | ) | ||||||||
| (1) | Reflects continuing and discontinued operations, other than the revenue figure for March 31, 2026, which reflects only continuing operations. |
| (2) | Net loss per share is based on the weighted average number of shares outstanding during each reporting period, which may differ on a quarter-to-quarter basis. As such, the sum of the quarterly net loss per share amounts may not equal full-year net loss per share. |
Historical quarterly results of operations and net loss cannot be taken as reflective of recurring revenue or expenditure patterns of predictable trends, largely given the non-recurring nature of certain components of our revenues, unpredictable quarterly variations in net finance income and of foreign exchange gains and losses.
Historical quarterly sales and results primarily fluctuate due to variations in the timing of customer orders of different product mixes, and changes in the optimal use of our capacity to manufacture products.
Consolidated Statements of Financial Position Data
| (in thousands of US dollars) | March 31, 2026 | December 31, 2025 | ||||||
| $ | $ | |||||||
| Cash and cash equivalents | 5,005 | 7,307 | ||||||
| Trade and other receivables and other assets | 3,420 | 2,886 | ||||||
| Inventory | 1,099 | 1,307 | ||||||
| Restricted cash equivalents | 71 | 125 | ||||||
| Property, equipment and intangible assets | 9,246 | 9,806 | ||||||
| Total assets | 18,841 | 21,431 | ||||||
| Payables, accrued liabilities and income taxes payable | 930 | 2,005 | ||||||
| Current portion of provisions | - | 269 | ||||||
| Current portion of deferred revenues | - | - | ||||||
| Lease liabilities | 2,023 | 2,149 | ||||||
| Warrant and DSU liabilities | 569 | 1,124 | ||||||
| Non-financial non-current liabilities (1) | - | 12,042 | ||||||
| Total liabilities | 3,522 | 17,589 | ||||||
| Shareholders’ equity | 15,319 | 3,842 | ||||||
| Total liabilities and shareholders’ equity | 18,841 | 21,431 | ||||||
| (1) | Comprised mainly of employee future benefits and non-current portion of deferred revenues. |
| 8 |
Liquidity and capital resources
The Company’s objective in managing capital, consisting of shareholders’ equity, with cash and cash equivalents and restricted cash equivalents being its primary components, is to ensure sufficient liquidity to finance its manufacturing operations, R&D costs, selling, general and administrative expenses and working capital requirements. Historically, the Company has raised capital via public and private equity offerings and issuances as its primary source of liquidity. The capital management objective of the Company remains the same as that in previous periods. The policy on dividends is to retain cash to keep funds available to finance the activities required to advance the Company’s product development portfolio and to pursue appropriate commercial opportunities as they may arise. The Company is not subject to any capital requirements imposed by any regulators or by any other external source.
Cash flows
The following table shows a summary of our consolidated cash flows for the periods indicated (including continuing and discontinued operations):
| (in thousands of US dollars) | Three months ended March 31, | |||||||
| 2026 | 2025 | |||||||
| $ | $ | |||||||
| Cash and cash equivalents – Beginning of period | 7,307 | 16,393 | ||||||
| Net cash used in operating activities | (2,177 | ) | (1,880 | ) | ||||
| Net cash used in financing activities | (82 | ) | (200 | ) | ||||
| Net cash used in investing activities | (23 | ) | (615 | ) | ||||
| Effect of exchange rate changes on cash & cash equivalents | (20 | ) | 60 | |||||
| Cash and cash equivalents – End of period | 5,005 | 13,758 | ||||||
Operating Activities
Cash used by operating activities was $2.2 million for the three-month period ended March 31, 2026, as compared to $1.9 million in the same period in 2025. The increase in operating cash outflows of $0.3 million is attributed primarily to a $2.7 million decrease in net working capital change in operation assets and liabilities offset by a decrease in net loss (excluding non-cash items) of $2.4 million.
Financing activities
Cash used in financing activities for the three-month periods ended March 31, 2026 was $0.1 million as compared to $0.2 million in the same period in 2025. The $0.1 million decrease is related to a decrease in payments of lease liabilities.
Investing activities
Cash used in investing activities was $0.02 million for the three-month period ended March 31, 2026 as compared to $0.6 million in the same period in 2025. The $0.6 million decrease in cash used in investing activities is primarily due to reductions in purchase of property and equipment.
Capital Stock
As
of May 11, 2026, we had
| 9 |
Discontinued Operations
Effective March 27, 2026, the Company derecognized the assets and liabilities of its German subsidiaries, AEZS Germany and Zentaris IVF GmbH from its consolidated balance sheet which resulted in a total income from discontinued operations of $10.9 million for the three-month period ended March 31, 2026. Effective March 27, 2026, the date of the loss of control, the results of the German subsidiaries met the definition of discontinued operations, and the results have been presented as such, including the prior year comparatives being restated.
The key operating results of discontinued operations for the period through March 31, 2026 are as follows:
Three months ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| $ | $ | |||||||
| Revenues | 18 | 113 | ||||||
| Cost of sales | (3 | ) | (39 | ) | ||||
| Gross profit | 15 | 74 | ||||||
| Research and development | 108 | 637 | ||||||
| Selling, general and administrative | 246 | 395 | ||||||
| Total operating expenses | 354 | 1,032 | ||||||
| Loss from operations | (339 | ) | (958 | ) | ||||
| Foreign exchange gain (loss) | 7 | (25 | ) | |||||
| Finance costs | (21 | ) | (1 | ) | ||||
| Other income | - | 3 | ||||||
| Gain on deconsolidation | 11,293 | - | ||||||
| Income (loss) from discontinued operations, net of tax | 10,940 | (981 | ) | |||||
| Basic income (loss) per share | 3.48 | (0.31 | ) | |||||
| Diluted income (loss) per share | 2.95 | (0.31 | ) | |||||
During the three-month period ended March 31, 2026, operating losses incurred by the German subsidiaries were funded by the parent company. Accordingly, the associated cash usage is reflected within the Company’s consolidated cash flow discussion. Subsequent to the loss of control and deconsolidation of the German subsidiaries, the Company will no longer incur operating losses related to these entities, nor will it be required to provide ongoing funding. As such, the deconsolidation is expected to eliminate future cash outflows and earnings volatility associated with the German operations, enhancing the Company’s overall cost structure and financial focus going forward.
Adequacy of financial resources
As of March 31, 2026, the Company had an accumulated deficit of $9.8 million and a net loss from continuing operations of $0.2 million resulting in negative cash flows from operations of $2.2 million for the three-month period ended March 31, 2026. We believe that our existing cash on hand will be sufficient to fund our anticipated operating and capital expenditure requirements for at least the next 12 months. We plan to finance our future operations and capital expenditures primarily through product sales and cash on hand. We also believe that our existing cash on hand will be sufficient to fund our anticipated operating and capital expenditure requirements beyond the next 12 months and through to 2027. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our capital resources sooner than we expect. We may also require additional capital to pursue in-licenses or acquisitions of other product candidates.
| 10 |
Our forecast of the period through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties, and actual results could vary materially as a result of a number of factors. Our future capital requirements are difficult to forecast and will depend on many factors, including:
| ● | the ability of the Company to suspend its reporting obligations under applicable U.S. securities laws and realize cost-savings in connection therewith; | |
| ● | the terms and timing of any other collaboration, licensing, and other arrangements that we may establish; | |
| ● | delays that may be caused by changing regulatory requirements; | |
| ● | the cost and timing of hiring new employees to support our continued growth and potential expense associated with any loss of key personnel; | |
| ● | the costs involved in filing and prosecuting patent applications and enforcing and defending patent claims; | |
| ● | the costs of filing and prosecuting intellectual property rights and enforcing and defending any intellectual property-related claims; | |
| ● | the costs associated with any potential late receipt or non-receipt of trade and other receivables; | |
| ● | the potential costs associated with foreign currency fluctuations or changing interest rates; | |
| ● | our ability to expand our customer base and related demand fluctuations; | |
| ● | the costs associated with any potential interruption or quality impacts on raw material supplies; | |
| ● | the use and effects of tariffs could materially impact our costs and revenues, as well as the macroeconomic framework in which we operate; | |
| ● | the costs of responding to and defending ourselves against complaints and potential litigation; | |
| ● | the extent to which we acquire or in-license other product candidates and technologies; | |
| ● | the terms and timing of any PGX manufacturing or licensing arrangement that we may establish; and | |
| ● | the costs associated with commercialization and development of PGX. |
Contractual obligations and commitments as of March 31, 2026
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 Gas eXpanded Technology (PGX) for the processing of various polymers. The royalty percentage rate would be 2% strictly for sales made from avenanthramides produced from the AG technology while royalty percentage rates would range between 1.0% to 3.5% for sales made from products manufactured using the PGX Technology, the rate being according to the classification of the resulting product (cosmeceutical, nutraceutical, pharmaceutical).
Contingencies
From time to time, the Company may be a party to litigation and subject to claims incidental to its business. Although the results of litigation and claims cannot be predicted with certainty, the Company currently believes that the final outcome of these matters will not have a material adverse effect on its business. At each reporting period, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable, requiring recognition of a loss accrual, or whether the potential loss is reasonably possible, requiring potential disclosure.
Critical Accounting Estimates and Judgments
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, 2025, except for those noted in note 2 of the interim condensed consolidated financial statements for the period ended March 31, 2026.
Financial Risk Factors and Other Financial Instruments
The nature and extent of our exposure to risks arising from financial instruments, including credit risk, liquidity risk and market risk and how we manage those risks are described in note 24 to our audited consolidated financial statements as of December 31, 2025. There have been no significant changes in risks arising from financial instruments during the three-month period ended March 31, 2026.
Related Party Transactions
During the three-month period ended March 31, 2026, other than employment agreements and indemnification agreements with our management, there are no further related party transactions.
Off-Balance Sheet Arrangements
As of March 31, 2026, we did not have any interests in special purpose entities or any other off-balance sheet arrangements.
| 11 |
Risk Factors and Uncertainties
An investment in our securities involves a high degree of risk. In addition to the other information included in this MD&A and in the related consolidated financial statements, investors are urged to carefully consider the risks described under the heading “Risk Factors” in the Annual Report on Form 20-F for the year ended December 31, 2025 and under the heading “Risks and Uncertainties”, for a discussion of the various risks that may materially affect our business. The risks and uncertainties not presently known to us or that we currently deem immaterial may also materially harm our business, operating results and financial condition and could result in a complete loss of your investment.
Our most recent Annual Report on Form 20-F was filed with the relevant Canadian securities regulatory authorities at www.sedarplus.ca and with the SEC at www.sec.gov, and investors are urged to consult such risk factors.
| 12 |
Exhibit 99.3
FORM 52-109F2
CERTIFICATION OF INTERIM FILINGS
FULL CERTIFICATE
I, Peter Puccetti, Interim Chief Executive Officer and Chair of the Board of Directors, COSCIENS Biopharma Inc., certify the following:
| 1. | Review: I have reviewed the interim financial report and interim MD&A (together, the “interim filings”) of COSCIENS Biopharma Inc. (the “issuer”) for the interim period ended March 31, 2026. |
| 2. | No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings. |
| 3. | Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings. |
| 4. | Responsibility: The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer. |
| 5. | Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the interim filings |
| (a) | designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that |
| (i) | material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and |
| (ii) | information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and |
| (b) | designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP. |
| 5.1 | Control framework: The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is Internal Control – Integrated Framework: 2013, issued by the Committee of Sponsoring Organizations of the Treadway Commission. |
| 5.2 | N/A |
| 5.3 | N/A |
| 6. | Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer’s ICFR that occurred during the period beginning on January 1, 2026 and ended on March 31, 2026 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR. |
Date: May 12th, 2026
| /s/ Peter H. Puccetti | |
| Peter Puccetti | |
| Interim Chief Executive Officer |
Exhibit 99.4
FORM 52-109F2
CERTIFICATION OF INTERIM FILINGS
FULL CERTIFICATE
I, Giuliano La Fratta, Chief Financial Officer, COSCIENS Biopharma Inc., certify the following:
| 1. | Review: I have reviewed the interim financial report and interim MD&A (together, the “interim filings”) of COSCIENS Biopharma Inc. (the “issuer”) for the interim period ended March 31, 2026. |
| 2. | No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings. |
| 3. | Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings. |
| 4. | Responsibility: The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer. |
| 5. | Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the interim filings |
| (a) | designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that |
| (i) | material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and |
| (ii) | information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and |
| (b) | designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP. |
| 5.1 | Control framework: The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is Internal Control – Integrated Framework: 2013, issued by the Committee of Sponsoring Organizations of the Treadway Commission. |
| 5.2 | N/A |
| 5.3 | N/A |
| 6. | Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer’s ICFR that occurred during the period beginning on January 1, 2026 and ended on March 31, 2026 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR. |
Date: May 12th, 2026
| /s/ Giuliano La Fratta | |
| Giuliano La Fratta | |
| Chief Financial Officer |