I just went through this battle the other day without too much problem. Are you sure the enemy doesn't use reversal gas on himself along with your characters? When I battled Dr. Lugae he did the reversal thing and I used healing items on him. Don't just use elixirs and potions, make sure to have cecil's white magic and rosa's white magic at the ready when you fight the boss. It helps alot if you train until rosa learns curaja.