UPDATE 2-Abbott gets FDA OK on glucose monitoring system

(Adds analyst comment, stock price)

CHICAGO, March 13 (Reuters) - Abbott Laboratories Inc (ABT.N: Quote, Profile, Research, Stock Buzz) said on Thursday it won U.S. regulatory approval for its continuous glucose monitoring system for people with diabetes.

The product, called FreeStyle Navigator, discretely measures glucose levels through a sensor placed in the back of the upper arm or abdomen.

It will be available by prescription in the second quarter, the company said. It has been sold outside the United States since September 2007.

"Navigator's accuracy is considered to be one of its strengths," Wachovia analyst Larry Biegelsen wrote in a research note.

The sensor needs to be replaced every five days versus every three days for Medtronic's (MDT.N: Quote, Profile, Research, Stock Buzz) competing product. Although Navigator needs to be calibrated four times over five days versus two times per day for the others, the Navigator requires a relatively long initial 10 hour initialization time versus two hours for the others, he noted.

"We currently model no incremental revenue from the Navigator in our Abbott model so this represents modest upside," Biegelsen wrote, noting that uptake of these devices has been slow due to poor reimbursement by insurance companies.

Shares of Abbott were up 82 cents to $52.16 in midday New York Stock Exchange trade.

(Reporting by Debra Sherman; Editing by Derek Caney)