Gutted the upper gear set in my SEI (alpha) drive over the weekend. This makes two drives in less than a year with very little run time.

Brief synopsis:
Boat is a 20ft Concord. Weighs about 2800 lbs or so
Mild built 350, Horsepower <= 400
Last summer I gutted my 1.50 ratio alpha one
Replaced it with a new SEI 1.65 ratio drive
Did correct break in procedure on new drive.
Was pulling the kids around on the tube and all was good early in the day.
We get to the swimming cove and the boat starts making a clunking noise in neutral
Tow boat in
Drain drive oil
Oil is black in color and full of metal flakes
Only third time out with boat this year
Any ideas why I'm killing gears all of a sudden?

What oil?
How often do you change it?

Mercury oil, changed every year at least

The new drive had the fluid changed at the beginning of the season
I've only ran a tank and a half of gas through the boat this season.

I should also mention that at WOT the engine is running at about 5600-5800 rpm. Most I hold it there is 30 seconds to a minute at a time

400 hp and 5800 rpm is asking a lot from an alpha......

I know I'm over the power limit. Would jumping from a 21p to a 23p prop help some by lowering the rpm?

You are in a heavy boat pushing too much tru it. Pulling skiers too.....

Run 140 weight and hope for the best.

Then you are just increasing the torque load on the drive. Its bravo shopping time

Once my warranty on the SEI drive runs out I'll probably start looking

I have a similar engine at about 375 horse in a 206 formula. SEI upper, stock merc lower alpha. I turn about 5600 with a 21 and 5200 with a 23 mirage. I haven't had any issues, though I am easy on planing off, no airing the prop out, and no slamming the throttle forward. Also I have never towed anyone for water sports which is probably really hard on the drive. I run amsoil synthetic lube.

Maybe you should drop down to a 17 pitch for the days you are doing watersports