Finasteride is an oral medication known as a 5-alpha-reductase inhibitor. Approved by the FDA for hair loss in 1997, it works by stopping the production of DHT (dihydrotestosterone), a male sex hormone that can attack follicles on the head. Over time, DHT causes the follicles to shrink (a process called follicular miniaturization), so they produce thinner hairs and eventually none at all.