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am I wrong in thinking the heat occisia is supposed to cure the merchant/shop owner or not? cause if it is the game is not letting me cure me to progress and if it is not I could use a helping hand

Heat Occasia is not the medicine you need.  It is a component in making Spectral Syrup, and /that/ is the medicine you need.

Check your books at home (or continue following the instructions in the quest if you're not there yet) for how to make the latter.