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Remdesivir is the first antiviral medicine to receive approval from the Food and Drug Administration (FDA).
US regulators signed off on Thursday on the drug, which is given to hospitalised patients through an IV.
The drug has been authorised to be used in case of emergency since early in the pandemic but is the first treatment to win full approval from the FDA.
Donald Trump received the treatment after he contracted Covid-19 earlier this month and was hospitalised at Walter Reed Medical Center in Bethesda, Maryland.
The drug has been named Veklury by its creators, the California-based Gilead Sciences. The treatment has cut recovery time by five days - from 15 days to 10 on average - according to a large study led by the National Institutes of Health.
Veklury has been approved for use in adult and paediatric patients, aged 12 and older, weighing at least 88 pounds, for the treating of Covid-19 requiring hospitalisation.
The FDA notes that Veklury should only be administered in a hospital or in a similar healthcare setting capable of providing acute care.
The treatment works by inhibiting a substance the virus uses to make copies of itself.
Certain kidney and liver tests are required before starting patients on it to ensure it’s safe for them and to monitor for any possible side effects. And the label warns against using it with the malaria drug hydroxychloroquine, because that can curb its effectiveness.
FDA Commissioner, Dr Stephen M Hahn, said in a statement: “Today’s approval is supported by data from multiple clinical trials that the agency has rigorously assessed and represents an important scientific milestone in the Covid-19 pandemic.
"As part of the FDA’s Coronavirus Treatment Acceleration Program, the agency will to continue to help move new medical products to patients as soon as possible, while at the same time determining whether they are effective and if their benefits outweigh their risks.”
A recent WHO study showed that the drug has “little or no affect” on the mortality rate of patients hospitalised with Covid.
AP contributed to this report