Earlier quoted context omitted.
I have a simple way of remembering when to leave out the apostrophe. His, hers, its are all possessive and none of them have an apostrophe.
In this particular case 'it's' can also be possessive although it's considered non-standard, so to be correct you can always treat it like a contraction of 'it is'.
The ambiguity makes it hard for me to say. "It's the best" vs "its is the best"
It doesn't feel right dropping the is