Why it is better than max drawdown alone
Maximum drawdown only remembers the single worst moment. The Ulcer index looks at every day: a strategy that spends years 10% below its peak scores worse than one that briefly fell 15% and recovered quickly. That matches how painful a strategy actually is to hold. Quant Arena reports it as a percentage and also uses it in the drawdown component of the Arena Score.
Martin ratio
Dividing the annual growth rate by the Ulcer index gives the Martin ratio (also called the Ulcer performance index): return per unit of drawdown pain, a useful alternative to the Sharpe ratio for strategies with long flat periods.