That stinks, but it happens. My small business has a nice little solar robotics project that we've been selling for years. Niche, but the ONLY decent option in that field that's not insanely expensive. I knew that eventually we'd be copied in China... and we were. By like four different companies at once. Our $150 product now have competition that's selling at the $50 price point. We can't compete against that, the margins would be nothing. It sucks, but we knew it would happen eventually due to the high popuarity of our videos and guides so we're not too broken up about it.
Chin up. Find new things to customize and sell. Figure out a good marketing strategy to show why you're better than the competition. The fact that you have a lot of sales and a high rating will help you out. If you can be close to their price and offer cheaper shipping, since you're in the US, you'll manage to snag more sales. But just always keep in mind that you gotta always be innovating and creating new products. If you're getting strong sales you're going to be knocked off.
I believe the old saying "imitation is the sincerest form of flattery" applies to your situation.