To get beyond that point at this time, just level up Rachel to lvl 4 or 5 and win the fight. Heal your bones with B+ plus if you need to. It's a bug that's causing that loop.
It's not the only bug left to be fixed. At the city center of the map (where the police station is at,) be careful where you stand when you choose to parkour the buildings. If you stand at the side instead of the bottom when you climb the building that has the people inside that see Rachel climbing the building, the game will freeze because it couldn't get Rachel positioned right on the rooftop. Another one at the same area, go down to the map screen with the street chef and news studio then go back up to the city center. STAY AT THE BOTTOM OF THE SCREEN and turn to the left, there will be a yellow glitter on the roof next to you. Push Z or click the yellow glitter next to you then try doing whatever it asks you with the rooftop's, the game will freeze because you wasn't on the roof when you told the game to jump around to more places.
I'm waiting for the next updates because I really like this game. It's quickly become my favorite pornographic game!