Boris Johnson is celebrating a "major breakthrough" as the cheap and widely used steroid dexamethasone has been found to be the first drug to save the lives of COVID-19 patients.

The drug which is used to reduce inflammation has lowered the death rate by a third of severely ill patients in trial results announced on Tuesday.

"Of course while the chances of dying from COVID-19 have been greatly reduced by this treatment or significantly reduced by this treatment it is still far too high, so we must redouble our research efforts," he said.

"Today I think there is genuinely cause to celebrate a remarkable British scientific achievement, the benefits it will bring not just in this country but around the world."

The results suggest the drug should immediately become standard care in patients with severe coronavirus cases, said researchers who led the trials.

"This is a result that shows that if patients who have COVID-19 and are on ventilators or are on oxygen are given dexamethasone, it will save lives, and it will do so at a remarkably low cost," said Martin Landray, an Oxford University professor co-leading the trial, known as the RECOVERY trial.

"It's going to be very hard for any drug really to replace this, given that for less than $63.26 you can treat eight patients and save a life."

Co-lead investigator, Peter Horby, said dexamethasone was "the only drug that's so far shown to reduce mortality - and it reduces it significantly."

He said: "It is a major breakthrough.

"Dexamethasone is inexpensive, on the shelf, and can be used immediately to save lives worldwide."

There are currently no approved treatments or vaccines for COVID-19, the disease caused by the new coronavirus which has killed more than 431,000 globally.

The RECOVERY trial compared outcomes of around 2,100 patients who were randomly assigned to get the steroid, with those of around 4,300 patients who did not get it.

The results suggest that one death would be prevented by treatment with dexamethasone among every eight ventilated COVID-19 patients, Landray said, and one death would be prevented among every 25 COVID-19 patients that received the drug and are on oxygen.

"The survival benefit is clear and large in those patients who are sick enough to require oxygen treatment, so dexamethasone should now become standard of care in these patients," Horby said.

The RECOVERY trial was launched in April as a randomised clinical trial to test a range of potential treatments for COVID-19, including low-dose dexamethasone and the malaria drug hydoxycholoroquine.

The hydroxychloroquine arm was halted earlier this month after Horby and Landray said results showed it was "useless" at treating COVID-19 patients.