The behavior of liquid drops in the retropulsive jet produced by a peristaltic wave is investigated computationally. The computational geometry consists of a tube which is closed at one end, with the peristaltic wave that deforms the boundary moving toward it. A modified solver with the capability to couple mesh deformation and adaptive mesh refinement around moving drops was developed and validated with experimental data, and good agreement was found. A parametric study was then performed to determine the effect of interfacial tension, viscosity ratio, relative occlusion, and initial drop position on the drop's behavior and breakup characteristics. In particular, breakup regimes on graphs of capillary number vs viscosity ratio were determined for each initial drop position and relative occlusion. It was found that these breakup regimes were bounded above and below, and an optimal capillary number for breakup was determined. The volume of the parent drop after breakup decreased linearly with capillary number for low capillary numbers and was independent of the viscosity ratio. For higher capillary numbers, this volume generally increased with the viscosity ratio. It was also found that a drop with lower interfacial tension reached the apex plane sooner than a drop with higher interfacial tension, but once there, took longer to pass through this plane and longer to breakup. The viscosity ratio had negligible influence on the drop transit times for viscosity ratios less than one, while the breakup time generally increased with the viscosity ratio.