Paperpile really needs to make it possible for users to use other applications to annotate PDFs and save those annotations back to Paperpile without making a copy of the PDF. Apple has an open-in-place API that is designed to allow apps to do just that
From Apple’s website (Document Based Apps - Apple Developer):
You can store documents in your own app container, in a folder on iCloud Drive, or even in a third-party cloud provider’s app container. Open in Place lets multiple apps simultaneously edit an individual document, freeing users from the burden of keeping track of multiple copies in different locations. By supporting Open in Place, you can create a truly seamless document editing and collaboration experience your users will love.
At the moment I am using the app Highlights to annotate my PDFs. There are certain feature it has that I need for my research, features that the PDF viewer on Paperpile does not (and, honestly, doesn’t need to) support. As good as you make the PDF viewer in Paperpile, it is never going to provide all of the features that all of your users want, there will always be edge cases that are better served by third party pdf viewers. By giving users the option to open and annotate their PDFs in their application of choice, you will be able to make more of your customers happy.
The reference manager that I am using at the moment (Bookends) supports this API, so I can annotate my PDFs in whatever application I want. However, it does not integrate with Google Docs as nicely as Paperpile or make collaboration as easy. I would seriously consider changing if this feature was available on Paperpile.