Jan 20 (Reuters) - The U.S. health regulator's rejection of accelerated approval for Eli Lilly and Co's Alzheimer's disease drug extends the market lead for rivals Eisai and Biogen's treatment by months, analysts said.

The U.S. Food and Drug Administration (FDA) declined to approve donanemab because Lilly had not submitted data from enough patients who were treated for at least a year, the drugmaker said late Thursday.

"This is a modest positive for Biogen" because it delays donanemab's launch, Jefferies analyst Michael Yee said, adding that Eli Lilly could file for traditional approval by mid-2023.

Lilly's shares fell 1.1% to $347.23 in premarket trading.

"Lilly's inability to launch donanemab near-term will prevent them from expediting their launch post-full approval by depriving them of the ability to begin to educate physicians and patients," said Citi analyst Andrew Baum.

The setback for Lilly comes just weeks after the FDA granted Biogen Inc and Japanese drugmaker Eisai Co Ltd's accelerated approval for their Alzheimer's drug Leqembi.

Analysts are waiting for the traditional approval of Biogen's drug and for wider health insurance coverage before they expect sales of the drug to pick up.

Still, "we think, at minimum, it gives Eisai some extra time on the market... to build a lead over donanemab", said Baird analyst Brian Skorney.

Lilly expects to report results from a confirmatory late-stage trial of donanemab in the second quarter, which would form the basis of the drug's application seeking traditional FDA approval shortly thereafter.

"But if there is anything wrong with the (Eli Lilly) data set, it is easier to reject an unapproved drug than remove an approved drug from market," said Skorney. (Reporting by Khushi Mandowara in Bengaluru; Editing by Shailesh Kuber)