As the world's second largest API producer and the largest API exporter, China has comparative advantages in product prices and industrial infrastructure at the present stage, but factors other than market competition will still have a long-term impact on China's API industry. The global API market reached nearly US$ 170 billion in 2019 and is expected to grow at a compound annual rate of 7% in the future. According to statistics of the National Development and Reform Commission in 2019, China produces more than 1,500 APIs, with an output of 2.621 million tons, of which exports account for more than 60%, with an export value of US$33.683 billion. China is the world's second largest API producer and the largest API exporter. It is second only to the United States in output, and its export volume accounts for 30% of the world. However, with the ebb of globalization in recent years, major overseas pharmaceutical production and export countries began to focus on the localization of APIs. Especially due to the impact of the epidemic, the shortage of upstream API supply has affected the major preparation manufacturers such as the United States and India to varying degrees, which has accelerated the development of their API localization. Recently, for example, the United States granted loans to Kodak to transform its API production, and India plans to invest 100 billion rupees to build an API industrial park. At the same time, due to the impact of domestic environmental protection policies, China's API output has been declining year by year in recent years. In particular, China's total output of APIs in 2018 was 282 tons, which was a drop of nearly 20% from 2017. On the one hand, the development of API in China is restricted; on the other hand, the localization of APIs is strongly encouraged overseas, so the future of China's API industry is facing challenges.