Because Drain Life deals damage and heals, it receives a 50% penalty from +damage gear. The total bonus is then distributed amongst the five ticks of the spell. For example - if you have +100 spell damage, each tick of Drain Life will transfer +10 HP from the target ((100*0.5) / 5).
Drain Life combined with [Life Tap] can allow a Warlock to act as a tank.
Patch changes
Patch 4.0.6 (8-Feb-2011): Drain Life cast when under the effects of Soulburn no longer has higher damage than the normal version of Drain Life.
Patch 2.3.0 (13-Nov-2007): Drain Life and Siphon Life now reduce the amount healed when the warlock is affected by healing reducing effects (e.g. Mortal Strike, Wounding Poison).
/Patch 2.0.1 (05-Dec-2006): The range of "Drain Life" and "Drain Mana" spells have been increased.