FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

REPORT OF FOREIGN ISSUER

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

For the month of November 2007

ÆTERNA ZENTARIS INC.

1405, boul. du Parc-Technologique

Québec, Québec

Canada, G1P 4P5

(Address of principal executive offices)

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   o  Form 40-F  x

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934

Yes   o  No  x

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-   

DOCUMENTS INDEX

Documents Description

2

November 7, 2007

To Our Stockholders,

Over the past five months, the executive management team completed a thorough review of our extensive pipeline and business operations with the goal of identifying our critical success factors and placing the appropriate clarity and prioritization surrounding our key value drivers. We have therefore established the following main guidelines:

Cetrorelix, currently in a Phase 3 program for benign prostatic hyperplasia (BPH), is clearly the Company’s highest priority, being the asset with the largest combination of probability of success, proximity to launch and potential medical and commercial value. Furthermore, we plan to move cetrorelix into a Phase 2b trial in endometriosis, an indication for which we regained rights from Solvay last May. We will eventually seek commercial partners in both indications, as cetrorelix could prove to be a novel efficient treatment in those two large markets.

We have also established our cytotoxic conjugate, AEZS-108, as our highest earlier-stage priority, and will therefore initiate a Phase 2 trial with this compound in both endometrial and ovarian cancers before year end. We feel AEZS-108 has large market opportunities that could compare to those for the chemotherapeutic agent, doxorubicin.

As far as our global partnering strategy moving forward, it is clear that all commercially viable projects will be ideally developed internally through proof-of-concept in man while Asia (especially Japan) remains a market of interest for us.

By preparing this strategic roadmap, we have clearly established a solid foundation for the basis of our strategy and have identified the strategic levers we believe will ensure long-term, sustained growth.

At the corporate level, we completed our executive management team by appointing Paul Blake, M.D., Senior Vice President and Chief Medical Officer. With over 25 years of solid experience in clinical development and product launching for major pharmaceutical companies worldwide, he will be instrumental in effectively managing our development programs through to commercialization, specifically our Phase 3 program in BPH for cetrorelix, as well as focusing on our other high priority drug development programs.

At the Board level, Jürgen Ernst, acting Vice President of the Board since November 2005, was appointed Chairman of the Board.
Mr. Ernst is a seasoned executive, and we will continue to benefit from his 35 years of pharmaceutical industry experience, specifically corporate development and pharmaceutical product marketing expertise. He succeeds Eric Dupont, Ph.D., who founded the Company in 1991 and retired from the Board.

3

I believe that with this experienced, highly competent team along with our rich, self-sustaining pipeline, we have all the key elements to successfully place Æterna Zentaris in a new growth category and significantly unlock shareholder value.

In closing, on behalf of my colleagues and our Board of Directors, I thank you for your continued interest and support and look forward to communicating with you regularly regarding our progress over the year.

Sincerely,

Dave J. Mazzo, Ph.D.

President and Chief Executive Officer

4

Third Quarter 2007

Management’s Discussion and Analysis

of Financial Condition and Results of Operations

The following analysis provides a review of the Company’s results of operations, financial condition and cash flows for the three-month and nine-month periods ended September 30, 2007. In this Management’s Discussion and Analysis (MD&A), the “Company”, “we”, “us”, and “our” mean Æterna Zentaris Inc. and its subsidiaries. This discussion should be read in conjunction with the information contained in Æterna Zentaris Inc.’s interim consolidated financial statements and related notes for the three-month and nine-month periods ended on September 30, 2007 and 2006. Our consolidated financial statements are reported in United States dollars and have been prepared in accordance with generally accepted accounting principles in Canada, or Canadian Generally Accepted Accounting Principles (Canadian GAAP). All amounts are in US dollars unless otherwise indicated.

Company Overview

Æterna Zentaris Inc. (TSX: AEZ, NASDAQ: AEZS) is a global biopharmaceutical company focused on endocrine therapy and oncology.

We benefit from an extensive and balanced pipeline, combined with a management team with substantial pharmaceutical and business experience in developing, launching and marketing products.

We are focused on advancing our product development pipeline with a priority on our lead product candidate, cetrorelix, currently being studied in an extensive Phase 3 program for benign prostatic hyperplasia (BPH), as well as our promising, targeted earlier clinical-stage programs with high potential.

Key Developments for the Quarter Ended September 30, 2007

CORPORATE:

Change at the Board Level – The Board of Directors nominated Jürgen Ernst as Chairman of the Board of Directors and David J. Mazzo, Ph.D., the Company’s President and Chief Executive Officer (CEO), to its Board of Directors. Jürgen Ernst succeeds Eric Dupont, Ph.D., who founded the Company in 1991 and retired from the Board.

5

Appointment of Chief Medical Officer – We completed our executive management team with the appointment of Paul Blake, M.D., as Senior Vice President and Chief Medical Officer.

The Outcome of Management’s Strategic Review – We completed a thorough review of our extensive pipeline and business operations with the goal of creating a strategy optimized for success. The strategic plan includes the following fundamentals:

o            We are a multinational company with a clear vision to eventually become a fully integrated biopharmaceutical company (without commercial manufacturing). The necessary resources have been identified and allocated to achieve business success.

o            We have prioritized our pipeline, developed a partnering strategy and determined the value of our most immediate assets:

Cetrorelix

Cetrorelix, currently in a Phase 3 program for BPH, is clearly our highest priority, being the asset with the largest combination of probability of success, proximity to launch and potential medical and commercial value. We decided to seek a commercialization partner for cetrorelix, which, in this indication, has potential for base case peak annual sales of over $500 million in the United States market alone. After defining the critical path to registration, we expect to file a NDA in the first half of 2010 for cetrorelix in BPH.

Furthermore, after optimization of formulation and trial design, we plan to move cetrorelix into Phase 2b in the endometriosis indication and will announce timelines relative to this program once a clear strategy is established. The decision to proceed with development was made based on:

a)                 the proven safety and efficacy of Cetrotide^®;

b)                the overall database from preclinical and clinical studies in endometriosis;

c)                 the large unmet medical needs and commercial opportunity in the area of endometriosis.

Additionally, as with the BPH indication, Æterna Zentaris will eventually seek a commercialization partner for endometriosis as cetrorelix has the potential for base case peak annual sales of approximately $200 million in the U.S. market alone in this indication.

6

AEZS-108

We established our cytotoxic conjugate, AEZS-108, as our highest earlier-stage priority, and will therefore initiate a Phase 2 trial with this compound in both endometrial and ovarian cancers before year end. We believe AEZS-108 has significant market opportunities that could compare to those for doxorubicin.

o            Regarding our partnered programs, we will be fully supportive of the development activities conducted by our partners and will define a registration pathway for the geographic regions where we retain rights.

o            The advancement of preclinical and very early-stage development programs is prioritized based on risk-adjusted maximum market potential.

o            We established a clear global partnering strategy moving forward:

•                  All commercially viable projects will be ideally developed internally through proof-of-concept in man;

•                  Asia (especially Japan) remains a market of interest for Æterna Zentaris.

Consolidated Results of Operations

For the three-month and nine-month periods ended September 30, 2006, previously consolidated revenues and expenses of Atrium Biotechnologies Inc., now Atrium Innovations (Atrium), representing the former Active Ingredients & Specialty Chemicals Segment as well as the Health & Nutrition Segment, have been reclassified as discontinued operations. Since we disposed of our entire position in Atrium in January 2007, we will no longer have access to liquidity or cash flows from the said company in 2007 and ensuing years.

7

The following table sets forth selected Canadian GAAP consolidated financial data in thousands of US dollars, except per share data.

Consolidated Revenues

Consolidated revenues are derived from sales and royalties as well as license fees. Sales are derived from Cetrotide^® (cetrorelix), Impavido^® (miltefosine), reagents and active pharmaceutical ingredients. Royalties are derived from Cetrotide^® (cetrorelix), sold by Merck Serono in reproductive health assistance for in vitro fertilization. Furthermore, license fees are derived from non-periodic milestone payments, R&D

8

contract fees and amortization of upfront payments received to date from our licensing partners.

Consolidated revenues for the three-month period ended September 30, 2007 were $11.6 million compared to $10.6 million for the same period in 2006. The increase is attributable to higher license fees revenues, partly reduced by lower sales of Cetrotide^®. The increase in license fees revenues is related to a milestone payment of $1.4 million received from our partner, Ardana Biosciences, Limited (Ardana), for the initiation of a Phase 3 study for the diagnosis of growth hormone disorders with our Growth Hormone Secretagogue, AEZS-130. The sales of Cetrotide^® were lower for the three-month period ended September 30, 2007 compared to the same period in 2006, due to a significant first order of the product related to the launch in Japan in September 2006.

Consolidated revenues for the nine-month period ended September 30, 2007 were $33.8 million compared to $28.8 million for the same period in 2006. The increase in consolidated revenues is mainly attributed to higher sales of Cetrotide^®, due to the launch in Japan in September 2006, growth of Impavido^®, as well as additional license fees revenues.

Consolidated Operating Expenses

Consolidated cost of sales decreased to $3.4 million for the three-month period ended September 30, 2007 compared to $4 million for the same period in 2006. The decrease in cost of sales is related to lower sales of Cetrotide^® for the three-month period ended September 30, 2007. The corresponding gross margin increase for the three-month period ended September 30, 2007 is related to higher sales of products with higher margin compared to the same period in 2006.

Consolidated cost of sales for the nine-month period ended September 30, 2007 was $10.1 million compared to $8 million for the same period in 2006. There were no significant changes in the gross margin for the comparable periods. The increased cost of sales is related to higher sales of Cetrotide^® and Impavido^®.

Consolidated R&D costs, net of tax credits and grants (R&D) were $10.1 million for the three-month period ended September 30, 2007 compared to $6.2 million for the same period in 2006. Consolidated R&D costs, net of tax credits and grants were $26.3 million for the nine-month period ended September 30, 2007 compared to $20.2 million for the same period in 2006. The increase in R&D expense is related to the additional expenses incurred for the initiation in 2007 of our ongoing Phase 3 program with cetrorelix in BPH, as well as further advancement of targeted, earlier clinical-stage development programs including AEZS-108.

Consolidated selling, general and administrative (SG&A) expenses were $6.1 million for the three-month period ended September 30, 2007 compared to $4.5 million for the same period in 2006.

9

Consolidated SG&A expenses for the nine-month period ended September 30, 2007, were $15.8 million compared to $12.9 million for the same period in 2006. The increase in SG&A expenses for both the three-month and nine-month periods ended September 30, 2007 is due to additional expenses related to the restructuring of the management team and the Board, as well as the opening of a new office in Warren, New Jersey, U.S.A.

Consolidated loss from operations increased to $9.6 million for the three-month period ended September 30, 2007 compared to $5.8 million for the same period in 2006.

Consolidated loss from operations for the nine-month period ended September 30, 2007 was $23 million compared to $17.3 million for the same period in 2006. The increase in consolidated loss from operations for both the three-month and nine-month periods is attributable to increased R&D and SG&A expenses, partly offset by increased revenues.

Consolidated other expenses for the three-month period ended September 30, 2007 were $0.2 million compared to consolidated other revenues of $0.2 million for the same period in 2006. The decrease of consolidated other revenues for the three-month period is mainly attributable to a goodwill impairment loss of $500,000 related to our reagent business in Salt Lake City, and partly offset by higher interest income derived from our short-term investments.

Consolidated other expenses for the nine-month period ended September 30, 2007 were $0.1 million compared to $0.7 million for the same period in 2006. The decrease in consolidated other expenses for the nine-month period ended September 30, 2007 relates to increased interest income derived from our short-term investments and reduced financial charges attributed to convertible term loans since they were converted into common shares in the first quarter of 2006. This was partly offset by additional expenses related to foreign exchange losses recorded in the first nine months of 2007 amounting to nearly $800,000. These foreign exchange losses are attributable to the weakness of the Canadian currency in comparison with the Euro and relates to a cash advance to our subsidiary in Germany. The decrease in consolidated other expenses for the nine-month period ended September 30, 2007 was also partly offset by a goodwill impairment loss of $500,000 related to our reagent business in Salt Lake City.

Consolidated income tax recovery for the three-month period ended September 30, 2007 was $1.1 million compared to $0.9 million for the same period in 2006.

Consolidated income tax recovery for the nine-month period ended September 30, 2007 was $4.3 million compared to $3 million for the same period in 2006. The increase in the income tax recovery for the nine-month period ended September 30, 2007 is mainly attributable to higher future income taxes related to taxable losses in jurisdictions where it is more likely than not that we will recover such losses.

10

Consolidated net loss from continuing operations for the three-month period ended September 30, 2007 was $8.7 million compared to $4.7 million for the same period in 2006. The increase in consolidated net loss from continuing operations is attributable to a combination of higher R&D, SG&A and other expenses recorded during the three-month period ended September 30, 2007.

Consolidated net loss from continuing operations for the nine-month period ended September 30, 2007 was $18.7 million compared to $15 million for the same period in 2006. The increase in consolidated net loss from continuing operations is attributable to higher R&D and SG&A expenses, partly offset by increased revenues from Cetrotide^® and Impavido^®, lower other expenses and higher income tax recovery.

Consolidated net earnings from discontinued operations recorded in the three-month and nine-month periods ended September 30, 2006 were completely attributable to our former subsidiary, Atrium, which operations were excluded from consolidation effective on October 18, 2006.

Discontinued operations include the following items:

Consolidated net loss for the three-month period ended September 30, 2007 was $8.7 million or $0.16 per basic and diluted share, compared to $1.6 million or $0.03 per basic and diluted share for the same period in 2006.

Consolidated net loss for the nine-month period ended September 30, 2007, was $18.7 million or $0.35 per basic and diluted share, compared to $5.7 million or $0.11 per basic and diluted share for the same period in 2006. The increase in consolidated net

11

loss for the three-month and nine-month periods ended September 30, 2007, is attributable to an increased net loss from continuing operations combined with the completion of the distribution of Atrium to our shareholders on January 2, 2007. Net earnings from discontinued operations for the three-month and nine-month periods ended September 30, 2006 were nearly $3 million and $9.3 million, respectively.

The weighted average number of shares outstanding used to calculate the basic and diluted net loss per share for the three-month period ended September 30, 2007 was 53.2 million shares compared to 52.7 million shares for the same period in 2006.

The weighted average number of shares outstanding for the nine-month periods ended September 30, 2007 and 2006, used to calculate the basic and diluted net loss per share, was 53.2 million shares and 51.9 million shares respectively. These increases reflect the issuance of Common Shares following the conversion of the convertible term loans in February 2006, the acquisition of a patent, as well as the exercise of stock options over the last 12 months.

Total Consolidated Assets and Long-Term Liabilities

   CONSOLIDATED BALANCE SHEET DATA

The decrease in total assets and in long-term liabilities is mainly attributable to the special distribution to our shareholders of our long-term investment in Atrium, effective on January 2, 2007.

Critical Accounting Policies and Estimates

There have been no significant changes in our accounting policies and estimates since December 31, 2006, with the exception of the application of new accounting standards as described below. Please refer to the corresponding section in our 2006 Annual Report for a complete description of our critical accounting policies and estimates. Access to a summary of differences between Canadian and U.S. Generally Accepted Accounting Principles (Canadian and U.S. GAAP) is referenced in Note 24 of our annual 2006 financial statements. Furthermore, significant differences in measurement and disclosure from the U.S. GAAP are set out in note 9 to our interim consolidated financial statements.

12

New Accounting Standards

In January 2005, the CICA issued four new accounting standards in relation with financial instruments: Section 3855 “Financial Instruments – Recognition and Measurement”, Section 3865 “Hedges”, section 1530 “Comprehensive Income” and Section 3251 “Equity”.

Sections 3855, 3865 and 1530 have been adopted by us on January 1, 2007. Adoption of these standards did not have any material impact on the Company’s consolidated balance sheet as described in note 2 of our interim consolidated financial statements for the three-month period ended September 30, 2007.

Effective January 1, 2007, we adopted CICA Handbook Section 1506 “Accounting Changes”. This Section establishes criteria for changes in accounting policies, accounting treatment and disclosures regarding changes in accounting policies, estimates and corrections of errors. In particular, this Section allows for voluntary changes in accounting policy only when they result in the financial statements providing reliable and more relevant information. Furthermore, this Section requires disclosure of when an entity has not applied a new source of GAAP that has been issued but is not yet effective. Such disclosures are provided below. The adoption of this Section had no further effects on the financial statements for the three-month and nine-month periods ended September 30, 2007.

Impact of Accounting Pronouncements Not Yet Adopted

The CICA issued Section 1535, “Capital Disclosures”, Section 3862, “Financial Instruments – Disclosures”, Section 3863, “Financial Instruments – Presentation” which replace Section 3861, “Financial Instruments – Disclosure and Presentation” and Section 3031, “Inventories” which will replace existing Section 3030. The new Sections are effective for interim and annual financial statements relating to fiscal years beginning on or after January 1, 2008. We are currently evaluating the impact of these new standards. Please refer to the note 2 of our interim consolidated financial statements for the three-month period ended September 30, 2007 for a complete description of these new standards.

Liquidity, Cash Flows and Capital Resources

Our operations and capital expenditures are mainly financed through cash flows from operating activities, the use of our liquidity, as well as the issuance of debt and common shares.

Our cash and short-term investments position reached $47.6 million as of September 30, 2007, compared to $61 million as of December 31, 2006. We believe that these liquidities will be adequate to meet operating cash requirements for the foreseeable future. However, acquisition of complementary businesses or additional investments in our product portfolio may require additional financing. As of September 30, 2007, cash and short-term investments of the Company included $44.9 million in Canadian currency.

13

The variation of our liquidity by activities is explained below, not considering any cash flows used or provided by discontinued operations in the comparative period.

Operating Activities

Cash flows used by our continuing operating activities for the three-month period ended September 30, 2007 were $6.2 million compared to $2.8 million during the same period in 2006. The increase in cash flows used by our continuing operating activities of $3.4 million is mainly attributable to higher R&D and SG&A expenses.

Cash flows used by our continuing operating activities for the nine-month period ended September 30, 2007, were $18.4 million compared to $10.4 million during the same period in 2006. The increase in the cash flows used by our continuing operating activities was primarily attributable to additional spending in R&D and higher SG&A. We expect cash flows used by our operating activities to increase in the next quarter of 2007 compared to the first three quarters of 2007.

Financing Activities

Cash flows used in continuing financing activities for the nine-month period ended September 30, 2007, were $0.7 million compared to $0.8 million for the same period in 2006. These funds were mostly used for debt reimbursement. There were no significant financing activities during the three-month periods ended September 30, 2007 and 2006.

Investing Activities

Cash flows used in continuing investing activities (excluding the change in short-term investments) were $1.3 million for the three-month period ended September 30, 2007 compared to $0.2 million for the same period in 2006.

Cash flows used in continuing investing activities (excluding the change in short-term investments) for the nine-month period ended September 30, 2007, were $2.2 million compared to $1.4 million for the same period in 2006. Cash flows were mainly used for the purchase of equipment and were partly offset during the second quarter of 2007 by proceeds for the sale of manufacturing equipment. The additional investment is related to the scaling-up of production of cetrorelix, as well as additional equipment and furniture for the opening of a new office in Warren, New Jersey, U.S.A.

14

Contractual Obligations

We have certain contractual obligations and commercial commitments. The following table indicates our cash requirements to respect these obligations:

Outstanding Share Data

As of November 5, 2007, there were 53,187,470 common shares issued and outstanding and there were 4,273,592 stock options outstanding.

15

Quarterly Summary Financial Information

(in thousands of US dollars, except per share data)

Note:        Per share data is calculated independently for each of the quarters presented. Therefore, the sum of this quarterly information may not equal the corresponding annual information.

16

Outlook for the remainder of 2007

We expect Cetrotide^® (cetrorelix) to continue to generate a significant part of our sales and royalties.

We expect R&D expenses to continue to increase throughout the remainder of 2007, primarily due to the continuation of our Phase 3 clinical development program with cetrorelix in BPH as well as the emphasis on clinical development of targeted earlier clinical-stage product candidates.

We expect cash flows used for operations to increase in the last quarter of 2007 in comparison with the three-month period ended September 30, 2007.

Financial and Other Instruments

Foreign Currency Risk

Since the Company operates on an international scale, it is exposed to currency risks as a result of potential exchange rate fluctuations. For the three-month period ended September 30, 2007, there were no operations using forward-exchange contracts and no forward-exchange contract is outstanding as of today.

Credit Risk

Financial instruments, which potentially subject the Company to concentrations of credit risk, consist primarily of cash and cash equivalents, short-term investments and accounts receivable. Cash and cash equivalents are maintained with high-credit quality financial institutions. Short-term investments consist primarily of bonds issued by high-credit quality corporations and institutions. Consequently, management considers the risk of non-performance related to cash and cash equivalents and investments to be minimal.

Generally, we do not require collateral or other security from customers for trade accounts receivable; however, credit is extended following an evaluation of creditworthiness. In addition, we perform ongoing credit reviews of all our customers and establish an allowance for doubtful accounts when accounts are determined to be uncollectible.

Interest Rate Risk

We are exposed to market risk relating to changes in interest rates with regard to our short-term investments.

17

Related Party Transactions and Off-Balance Sheet Arrangements

There were no related party transactions and no off-balance sheet arrangements included in the financial statements. As of September 30, 2007, we did not have interests in any variable interest entities.

Risk Factors and Uncertainties

There has been no significant change in the risk factors and uncertainties facing Æterna Zentaris, as described in the Company’s 2006 annual MD&A dated March 2, 2007 as filed with the Canadian Securities regulatory authorities on September 19, 2007 (which was included as Exhibit 99.4 to our Annual Report on Form 40-F filed with the SEC on March 23, 2007 and subsequently amended on September 19, 2007) as well as described in our short form base shelf prospectus dated September 27, 2007.

Continuous Disclosure

The Company is a reporting issuer under the securities legislation of all of the provinces of Canada and is registered in the United States and it is, therefore, required to file continuous disclosure documents such as interim and annual financial statements, a Proxy Circular, an Annual Information Form, material change reports and press releases with such securities regulatory authorities. Copies of these documents may be obtained free of charge on request from the office of the Secretary of the Company or through the Internet at the following addresses: www.aeternazentaris.com, www.sedar.com and www.sec.gov/edgar.shtml.

Changes in Internal Controls over Financial Reporting

There has been no change in the Company’s internal control over financial reporting that occurred during the three-month period ended September 30, 2007 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Forward-Looking Statements

This document contains forward-looking statements, which reflect our current expectations regarding future events. Forward-looking statements may include words such as anticipate, believe, could, expect, goal, guidance, intend, may, objective, outlook, plan, seek, should, strive, target and will.

The forward-looking statements involve risks and uncertainties. Results or performances may differ significantly from expectations. For example, the results of current clinical trials cannot be foreseen, nor can changes in policy or actions taken by such regulatory

18

authorities as the US Food and Drug Administration and the Therapeutic Products Directorate of Health Canada, or any other organization responsible for enforcing regulations in the pharmaceutical industry.

Given these uncertainties and risk factors, readers are cautioned not to place undue reliance on such forward-looking statements. We disclaim any obligation to update any such factors or to publicly announce the result of any revisions to any of the forward-looking statements contained herein to reflect future results, events or developments except if we are requested by a governmental authority or applicable law.

On behalf of management,

19

Æterna Zentaris Inc.

Interim Consolidated Balance Sheets

(expressed in thousands of US dollars)         

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

20

Æterna Zentaris Inc.

Interim Consolidated Statements of Operations

For the periods ended September 30, 2007 and 2006

(expressed in thousands of US dollars)

Statement of Comprehensive Loss

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

21

Æterna Zentaris Inc.

Interim Consolidated Statements of Cash Flows

For the periods ended September 30, 2007 and 2006

(expressed in thousands of US dollars)

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

22

Æterna Zentaris Inc.

Interim Consolidated Statements of Changes in Shareholders’ Equity

For the periods ended September 30, 2007

(tabular amounts in thousands of US dollars, except common shares data)