OBJECTIVE： To investigate the characteristics and trends of illegal circulation of counterfeit drugs in China， and to put forward monitoring countermeasures. METHODS： In empirical study， 3 typical cases of counterfeit drugs manufacturing and selling in China were analyzed （including Jiangsu Wuxi Internet transnational counterfeit drugs manufacturing and selling case， Shanghai Avastin eye drug case， Sichuan Dazhou counterfeit drugs case）， to compare the sources of counterfeit drug and illegal circulation pathway， thus find out the monitoring problems. RESULTS & CONCLUSIONS： Main reasons for illegal circulation of counterfeit drugs in China are as follows as drug circulation regulation absence of foreign-funded medical institutions， the existence of hidden drug circulation monitoring holes in urban medical institutions， under-developed and weak ability of distinguishing talse drug information internet counterfeit drugs sales regulatory means. It is suggested to establish drug management norms for foreign-funded medical institutions， improve drug circulation monitoring in primary medical institutions， establish pharmaceutical logistics （transportation） licensing system and strengthen online fake drug sale information monitoring and information publication.