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does this fix the bug where any health Emil gained from consuming immortals was taken and given to Annie after quitting and loading your save?

It should have! The issue was that saving the game set emil's max life back to default instead of keeping it increased. Now when you purify an immortal, both characters should have their life increased.

I see, is it a retroactive fix? Loading my save still has Emil at default while Annie has the boosts.

It unfortunately is not a retroactive fix. But you should still be able to complete the demo with the lower max hp.