UPDATE 1-US FDA tells J&J unit to halt hip device sales

* Agency: Corail Hip System not approved for certain uses

* FDA says TruMatch knee device also needs approval

* Agency sends J&J's DePuy warning letter on Aug. 19

* DePuy disputes some of FDA's claims, reviewing letter

* J&J shares down 1.5 percent

By Susan Heavey

WASHINGTON, Aug 24 (Reuters) - The U.S. Food and Drug Administration is ordering Johnson & Johnson's (JNJ.N) DePuy Orthopaedics unit to halt sales of its Corail Hip System for unapproved indications after marketing such "off-label" use, according to a warning letter made public on Tuesday.

DePuy's TruMatch Personalized Solutions System for artificial knees also lacks FDA approval, the agency said. The FDA asked the company to submit information so it can decide whether the product can be legally marketed.

But in a statement, DePuy said it did not believe that TruMatch needs "FDA clearance or approval because it is an instrument system." It also said that the issue with its Corail hips related to "specific wording" in company promotions.

"We are reviewing the letter to understand the FDA's concerns and will respond to their request for information," the company said.

FDA's letter comes amid a tighter crackdown on medical devices, including possible changes to the approval process under Margaret Hamburg, whom the Obama administration appointed to head the FDA.

DePuy's Corail hip product is FDA-approved for total hip arthroplasty to help improve patients' mobility, the agency said, but it is only supposed to be used without cement. A brochure on the company's website promoted cement use, which is not approved.

Such changes "represent a major change or modification in the intended use of your device that require a new premarket notification," the FDA wrote in the letter, dated Aug. 19. It asked the company to submit a list of all promotional materials for the hip system that include claims for unapproved uses as well as explain its plan for halting them.

For the TruMatch product, FDA said its records showed the company did not seek approval before selling the artificial knee positioning system and called on the company to submit an application. The system uses a computerized scan of a patient's leg to help surgeons place and position an artificial knee.

"The FDA will evaluate the information you submit and decide whether your product may be legally marketed," it said.

DePuy Inc, which manufactures various products for joints, the spine and neurological surgery, is one of dozens of units making medical devices for its diversified healthcare parent Johnson & Johnson, along with Ethicon Inc, Cordis Corp and other subsidiaries.

The FDA released the letter on its website at link.reuters.com/raj86n.

Shares of J&J were down 1.5 percent at $58.01 in midday trading, slightly lower than the over all S&P 500 Index .SPX, which was down 1 percent. (Reporting by Susan Heavey; Editing by Lisa Von Ahn and Matthew Lewis)