Objective To establish a regression equation for drug revenues by analyzing the factors influencing drug revenues in seven military hospitals from 2007 to 2010. Methods The data were obtained from the financial and performance-effect data in 7 hospitals from 2007 to 2010; the database was created by Excel 2003 software. Principal component regression analysis was performed for variables including the hospital scale, amount of service, local economic level, drug add rate using SPSS 18.0 software. Results and Conclusion (1) Hospital scale and amount of service were the critical influencing factors of drug revenues in military hospitals; (2) Per capita cost of outpatient and inpatient also contributed to drug revenues; and (3) drug add rate and local economic level were negative influencing factors of drug revenues.