BOULDER — Array BioPharma Inc. (Nasdaq: ARRY) has launched a new subsidiary to develop drugs using its ARRY-797 drug program.

Yarra Therapeutics LLC on Dec. 21 received all patents, patent applications and other intellectual property rights, pre-clinical and clinical data, regulatory submissions, inventory, contracts, equipment and books and records related to its ARRY-797 drug program, the company stated in a filing with the U.S. Securities and Exchange Commission.

Yarra — which is “Array” spelled backwards — was formed to develop drugs for rare diseases. The ARRY-797 drug is in Phase 2 trials for patients with cardiomyopathy, a rare, degenerative cardiovascular disease.

Bryan Stuart will serve as Yarra’s president and CEO.  Prior to joining Yarra, he led Chicago-based Kastle Therapeutics, a biopharmaceutical company focused on developing and commercializing therapeutics for patients with rare diseases.

Stuart will seek third-party equity financing “for use in further development and commercialization, to provide working capital for Yarra Therapeutics, and for general corporate purposes,” the company stated. Array will provide temporary payroll, accounting, development and certain other administrative and scientific services to Yarra.

The Yarra spinoff was contemplated in a Note Purchase Agreement dated Sept. 2, 2016  between Array and certain affiliated entities of Redmile Capital, and a convertible promissory notes issued by Array for $10 million.

Any funds raised by Yarra would result in a reduction of Array’s ownership interest in Yarra.