Health Information Designs Inc., an Arlington firm specializing in monitoring prescription drug use, has been purchased for $8 million by Value Health Inc., a Connecticut-based health care company.

With the purchase, HID joins the growing health care network managed by Value Health, which since its formation last May by venture capitalist Robert E. Patricelli has bought five companies with total annual revenues of $50 million.

HID is the nation's leading provider of computerized equipment for reducing the risks associated with drug-induced illnesses. According to HID estimates, some 7 percent of hospitalizations are caused by adverse reactions to combinations of drugs that patients have been prescribed for different conditions.

The company has developed a computerized monitoring system for prescriptions that identifies potential conflicts and informs doctors and has reduced hospitalization in these cases by 50 percent.

"The HID product is one of those rare inventions that both saves money and enhances health care quality," Patricelli said. "Most of what has been done in trying to manage prescription drug cost is discounts on the price side. {HID} is the only company I could find that is dealing with the utilization of drugs."

HID executive vice president Aida Le Roy, who,like other members of the company's management team will stay with HID after the takeover is completed, said the affiliation with Value Health "will open up a lot of new doors for us." Value Health has a subsidiary, Medicost Pharmacy Program Inc., as well as contacts with health insurance agencies and health maintenance organizations, which Le Roy said will give HID access to a far greater number of potential customers.

"Our services are dependent on capturing pharmaceutical use data, and their Medicost is in that business," Le Roy said. "The combination with Value Health allows us to put together a complete pharmaceutical benefit package."