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The US Food and Drug Administration (FDA) on Thursday approved the first medication for people with a severe type of non-alcoholic fatty liver disease.

Madrigal Pharmaceuticals' Rezdiffra was shown to improve liver scarring in a clinical trial involving hundreds of people with non-alcoholic steatohepatitis (NASH), the worst form of the condition caused by a buildup of fat in the liver.

"Previously, patients with NASH who also have notable liver scarring did not have a medication that could directly address their liver damage," said the FDA's Nikolay Nikolov.

"Today's approval of Rezdiffra will, for the first time, provide a treatment option for these patients, in addition to diet and exercise."