The Cubs also picked infielder Ricky Alvarez from the Angels farm system in the Triple-A phase of the Draft, but traded him to the Monterrey team in Mexico for cash considerations.
The Cubs lost two players in the Major League portion as the Orioles took infielder Ryan Flaherty and the Red Sox picked infielder Marwin Gonzalez. Gonzalez was later traded to the Astros.
In 38 Minor League games, Castillo is 7-4 with a 2.43 ERA since he was converted from shortstop after the 2009 season. He has 111 strikeouts and has walked 42 in that stretch.
Last year, the 22-year-old right-hander was 4-2 with a 2.54 ERA in 21 games, including two starts, for the Class A Lakewood BlueClaws. He gave up 13 earned runs on 37 hits and 16 walks over 46 innings.
Cubs general manager Jed Hoyer credited scouting director Tim Wilken and special assistant Dave Littlefield with their work in scouting Castillo. Although the right-hander is new to pitching, Hoyer said he has good velocity and can spin a breaking ball well. Right now, he's projected for the Cubs bullpen.
"Obviously, he's a long way away or they would've protected him, but we like him as a prospect and thought it was a worthwhile gamble taking him," Hoyer said. "We're hopeful it works out."
The Cubs have had success with other converted pitchers, including Randy Wells and Carlos Marmol, who were both former catchers. Kyler Burke is switching from outfield to pitching as well. Hoyer said Castillo has made a lot of progress, considering he hasn't been pitching that long.
"He's come along pretty quickly," Hoyer said. "He was in instructional league and pitching in the South Atlantic League last year and had good success."
The Cubs will pay the Phillies $50,000 for taking Castillo in the Rule 5 Draft. The Cubs must keep him on the 25-man roster next season, and he must remain active for a minimum of 90 days. If he does not remain active, Castillo will be offered back to the team from which he was selected for $25,000.
Alvarez batted .257 in 126 games with 31 doubles, 10 homers and 64 RBIs for the Angels' Class A Cedar Rapids team. Originally signed by the Mets as a non-drafted free agent in June 2007, he was currently playing for Mexicali in the Mexican Winter League.
The Cubs will receive $100,000 total after losing both Flaherty and Gonzalez in the Major League phase of the Draft. Hoyer said he was not surprised they were taken. The baseball operations department had long discussions about whether to keep the pair on the 40-man roster, which would have protected them from being selected.
"Those were two guys we spent a lot of time talking about and, candidly, we thought they were two guys who may well get taken," Hoyer said. "They're both good players and we hope we get them back. That's the nature of setting your roster. You have to make hard decisions.
Carrie Muskat is a reporter for MLB.com. She writes a blog, Muskat Ramblings, and you can follow her on Twitter@CarrieMuskat. This story was not subject to the approval of Major League Baseball or its clubs.