In relation to Taoism, the practice of alchemy has taken two forms. On the one hand is "external alchemy," which involves creating and ingesting herbal or mineral elixirs, in support of improved physical health and longevity. At certain points in Taoism's history, the quest for Immortality took the form of much experimentation of this sort. The results were sometimes less than ideal - and death by poisoning not an altogether uncommon outcome.
The second form of Taoist alchemy is "internal alchemy," which involves the cultivation and circulation of the Three Treasures of jing (reproductive energy), qi (life-force energy) and shen (spiritual energy). In internal alchemy practice, it is the body of the Taoist practitioner that is the laboratory, and the refined energy produced there, the elixir.
I think it's safe to say that the majority of Taoist alchemists today give priority to inner alchemy practices. External alchemy does, however, still exist, in various forms. Chinese herbal medicine, for instance, can be understood as a form of Taoist external alchemy. Here are links to several other interesting external alchemical formulations which, in my estimation, are quite legitimate, safe and powerfully healing:
(1) Tonic Gold created in India by Petri Murien;
(3) The homeopathic alchemy of Alfons Ven.