UPDATE 1-US warns Novartis generic unit on plant problems

(Adds Novartis comment, details from letter, shares)

WASHINGTON, Aug 26 (Reuters) - U.S. regulators have warned Novartis AG's (NOVN.VX) generic drug unit Sandoz about manufacturing problems at a North Carolina plant, a letter released on Tuesday said.

Food and Drug Administration inspectors found the company failed to properly validate the manufacturing process for metoprolol succinate ER tablets before distributing them, an Aug. 12 letter from the agency said. The drug is a generic form of AstraZeneca's (AZN.L) Toprol XL.

"We question the continued distribution of this product until better process controls are implemented and process validation is completed," the FDA letter said.

"We are also concerned that the problems noted in the metoprolol validations could be indicative of problems and poor decisions made with other product validations," the agency said.

Novartis spokesman Eric Althoff said the FDA's concerns were "primarily about documentation and validation."

"We are working together with the FDA to solve the problem," he said.

The FDA sends dozens of warning letters each year. Most issues are resolved without further action, but the letters can lead to product seizures and other penalties.

The FDA posted the letter to Sandoz on its website here

Novartis shares were down 0.4 percent in Swiss trading. (Reporting by Lisa Richwine in Washington and Paul Arnold in Zurich; Editing by Steve Orlofsky, Dave Zimmerman)