(Adds details on baricitinib, analyst comment, share movement)

Dec 13 (Reuters) - Eli Lilly and Co on Wednesday forecast 2018 profit and revenue ahead of Wall Street estimates on strong demand for recently launched drugs such as Trulicity and Taltz.

Lilly said it was expecting a regulatory decision on its rheumatoid arthritis drug baricitinib, whose marketing application was initially rejected by the U.S. Food and Drug Administration.

The drugmaker also expects to launch a new indication for Taltz in psoriatic arthritis.

Investors have been fearful about competition for its newer growth drivers such as psoriasis drug Taltz and diabetes drug Trulicity, with a rival for Trulicity by Novo Nordisk expected to be launched soon.

Competitive threats will be important to watch over the course of the year given the importance of Trulicity and the broader diabetes business to Lilly, Credit Suisse analyst Vamil Divan said in a client note.

Lilly's top-selling, older drugs have been facing the threat of competition, with Sanofi SA's follow-on biologic to insulin product Humalog getting U.S. approval and the launch of a generic to rival Viagra causing concern for its Cialis franchise.

The company said it expected 2018 revenue of $23.0 billion-$23.5 billion and adjusted earnings of $4.60-$4.70 per share.

Analysts on average were expecting revenue of $23.07 billion and earnings of $4.64 per share, according to Thomson Reuters I/B/E/S.

Lilly reaffirmed its expectation of at least 5 percent average annual revenue growth from 2015 to 2020, on a constant currency basis.

The company also lowered its 2017 earnings forecast to $1.56-$1.66, due to asset impairment, restructuring and other charges. It reiterated its 2017 adjusted earnings forecast of $4.15-$4.25 per share.

The stock, which had been up about 18 percent this year, was little changed before the bell on Wednesday. (Reporting by Manas Mishra in Bengaluru; Editing by Martina D'Couto)