The adventurers head to the sanatorium to question Grayst Sevilla, the man taken into custody outside the barn where the corpses of the three con men were found murdered. The proprietor, Erin Habe, doesn’t want to let them see his patient, but reluctantly agrees once he finds out that Sheriff Hemlock has sent them. He brings the patient down to the large first-floor workroom, and it’s obvious that he’s in the advanced stages of Ghoul Fever. He sits, muttering to himself about “razors”, and how “the Skinsaw Man is coming”. Sorcerer Dave tries to ask a question, and as Grayst looks at him, his countenance changes.
“He said. He said you would visit me. His Lordship. The one that unmade me said so. He has a place for you. A precious place. I’m so jealous. He has a message for you. He made me remember it. I hope I haven’t forgotten. The master wouldn’t approve if I forgot. Let me see… let… me… see… He said you should come to the Misgivings soon, to meet the Pack, for they have something wonderful to show you.”
With the message related, Grayst collapses and issues a low moan. His moan turns into a shriek as he leaps upon the table and tears his arms free of the straightjacket. He lunges for Sorcerer Dave but the adventurers are able to defeat him. They confron Erin Habe, who is attempting to escape, and Erin orders his Tiefling assistants to attack. They too are vanquished, at which point Erin surrenders and begs the adventurers for mercy. He tells them that there is a necromancer named Caizarlu Zerren who has a lair in the basement. He is the real master of the Sanatorium, and has been blackmailing Erin for some time. Whenever a patient dies, Erin must give the corpse over to Caizarlu for his “research”. The adventurers turn over Erin to the town guard, and head into the lair of the necromancer.
Caizarlu is expecting the guests, and he and his zombie minions try unsuccessfully to vanquish the adventurers. He is captured, and although he doesn’t know anything about the murders, he has heard of an increase in Ghoul activity in the farmlands surrounding Sandpoint. Knowing that the paladin is probably going to kill him, he makes a desperate final attack against the adventurers, but is ultimately slain.