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CNBC Exclusive: CNBC Transcript: OncoImmune Founder and CEO Dr. Yang Liu Speaks with CNBC’s “Squawk Box” Today

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WHEN: Today, Monday, November 23

WHERE: CNBC's "Squawk Box"

Following is the unofficial transcript of an EXCLUSIVE CNBC interview with OncoImmune Founder and CEO Dr. Yang Liu on CNBC's "Squawk Box" (M-F, 6AM-9AM ET) today, Monday, November 23. Following is a link to the video on CNBC.com:

https://www.cnbc.com/video/2020/11/23/oncoimmune-founder-merck-acquisition-covid-19-drug.html

All references must be sourced to CNBC.

MEG TIRRELL: So, Merck is acquiring a small privately held company called Oncolmmune for $425 million. And this company has a drug for COVID-19, that's proven to be strikingly effective in helping people who are hospitalized with the disease and requiring oxygen. It's a drug called CD24Fc, and these results were actually presented at the end of September and really flew under the radar but they show that they cut the risk of death, or people proceeding to respiratory failure and needing a ventilator by more than 50% versus placebo in this trial. They compared it to standard of care so they are seeing benefits on top of drugs, including Remdesivir or Dexamethasone potentially. They also said there was a 60% higher probability of improvement and clinical status among people who took the drug. I talked with Merck's research chief Dr. Roger Perlmutter about these data in the acquisition he told me quote, "The results are remarkable… nobody would have believed that it would have this kind of effect." Guys, the problem though is the drug is in short supply. Oncolmmune is a small company and so Merck is acquiring them to try to ramp up supply of this drug. Joining us now to discuss this news is, Oncolmmune Founder and CEO Dr. Yang Liu. Dr. Liu thank you for being with, with this with us this morning. Tell us out the effects that your drug appears to have and helping these very sick patients with COVID-19.

DR. YANG LIU: Yes, Ms. Tirrell, my pleasure. Thank you for having me here. Yes, the drug was effect can be matched by two ways as you mentioned, one is to see the probability of patient improving the clinic status, which we showed compared patients who receive standard of care, those results of care plus you can see, seeing 60% better chance of clinical recovery. On the other hand, if you look at the disease progression as measured by patient who will need intubation or patient who may die, the chances cut by more than half. So, this is quite remarkable. You know, in our sort of observation.

TIRRELL: It certainly is and a lot of folks that I've spoken with from months of Slaoui and Operation Warp Speed to of course Roger Perlmutter at Merck calling these remarkable, can tell us a little bit about how the drug works and why you think it works so well in doing this? It's sort of similar I think to steroids and that it tamps down the immune response that can take over in the severe forms of the disease?

LIU: Yes, the drug was based on many years of research, in fact, my colleague and I have been working on a new pathway for the last 20 plus years. So, this is a pathway that selectively control inflammation triggered by cell death as you know, the COVID, the viruses itself, get out of the cell back here in the cells. Therefore, in the critical organs such as lung, there's a massive cell death of the infection. So, when the cell die, they trigger inflammation, that inflammation is controlled by CD54 and signaling pathway. What this drug does is act as avenues to tamp down inflammation that triggered by cell death. So, this information itself evolved, several different aspects that affects the, as you know, probably know as Sclereid stone that effect that cause a lot of cell infiltration, lung tissue. And, also, we saw some observation that in COVID-19 patient is a thrombotic firmboses so, and there's also loss of immune cell function. All these four aspects, can be, can be corrected, in a sense, by this drug. So, this one is unique in that it has a general effect on several different aspects that get more and more targeted therapeutics may not be able to affect them at the same time, we think that's a better effect than we expected.

TIRRELL: It's certainly a remarkable result. Tell us about the supply of this drug. How much is available now? And you know, how long it will take to make enough for, to be able to apply for FDA emergency use authorization for it to help people?

LIU: Yes, right now, we're ramping up production as we speak at two different sites, and that they are putting all the risk, we're putting all our resources on it. So we expect that by the end of the year or early next year generally we'll start we'll have some drug being supplied to patients.

TIRRELL: And why do you think the results did not garner more attention when you, you posted them on your website at the end of September. I heard about them, you know, a few weeks ago from months of Slaoui who said these are just remarkable results and I thought well, they're out there, why haven't we heard about them? Why do you think they flew so under the radar?

LIU: Yeah. First of all, we, we are so innocent cautious in the sense that we were just meant for to get a drug produced. We haven't really made a major effort to contact a news organization by going through the regulator bodies to report our data to regulator body size FDA. And also, we are talking to grant funding agencies, and then so there which will which get attention for WOS, that's how we work through the system. We felt that we need to make enough drop before we make it more public.

TIRRELL: Well, that makes sense Dr. Liu, we appreciate you being with us this morning, I know that this is the culmination of decades of work and we're excited to see you know where it goes from here thank you for being with us.

LIU: Thank you for having me. Bye bye.