Since the occasion of the alien irruption in Avengers, Tony has been having fear attacks. Aldrich Killian, formerly an impaired scientist who was rejected by Tony for an idea around healing crippling injuries, is the villain in this film. Aldrich’s treatment, called Extremis, is unstable. While it temporarily cures the subject, it also causes them to explode ultimately. To cover up these explosions, Aldrich creates a terrorist by the name of Mandarin and gives it the face of an aspiring British actor. He makes it appear like Mandarin has been blowing up stuff.
Long story Suddenly, Aldrich blows up Tony’s home, kidnaps Pepper, injects her with Extremis so that Tony would be forced to fix the excrescence, gets into a brawl with everybody, has a showdown with the Iron Man, and eventually gets blown up by a super-powered Pepper. Tony stabilizes the goods of Extremis inside of Pepper Pots. Now, she'll not explode, but it’s not mentioned if she has retained any of her superpowers.