Ash and his friends walk over to the Mahogany Gym, but it appears to be locked. A lady named Sheila informs the group that the Gym Leader, Pryce, has gone up to the mountains for his morning meditation under a waterfall. Sheila offers to escort them there, but they have to hurry after her. Meanwhile, Team Rocket, who was waiting at the Gym, tail them. After finally catching up with Sheila, they see Pryce. Ash is shocked to see that Pryce is the man who saved them on the bridge in the other day. Pryce says that it would be pointless to battle Ash, because his emotional bonds with his Pokémon have dulled their senses. After Ash protests, Pryce sends out his Dewgong. He tells Ash that if he can beat Dewgong, he will get his Gym battle.
Ash battles him with Phanpy and quickly loses. Pryce restates that Ash's heart was too involved in the battle to craft a good strategy. He dismisses the Gym challenge before walking off, though Ash follows close behind. Team Rocket, who witnessed the whole match, follows Ash. Soon, Ash gets separated from Pikachu, and the Rocket trio also lose each other for a moment. Jessie spots Ash and starts the motto, and when James says his line, they realize that they were both standing in the same bush. The chase for Pikachu eventually leads to the edge of a cliff, where Ash is cornered. Suddenly, Pryce appears and calls Team Rocket idiots for trying to forcibly steal someone else's Pokémon. Weezing launches a Smokescreen. Pryce prepares to guide out of the trouble, but the ground collapses underneath himself, Ash, and Pikachu.
As the trio free fall into a crevasse, Ash sends out Noctowl to help Pryce and Totodile to break their fall using Water Gun. At the top of the cliff, Team Rocket is arguing over whose idea the Smokescreen was, when Misty, Brock, and Sheila appear. Brock asks if they saw Ash, and Jessie and James run away, leaving Meowth to spill the beans. Sheila sees a small gully for them to climb down. At the bottom of the cliff, Pryce makes a spicy herbal medicine to restore Totodile's energy since it exhausted itself from the Water Gun. Pryce thanks Ash for how his Pokémon reacted under duress, but that as close as he is with them, he must retain strict discipline.
Back up at the top, Sheila explains to Misty and Brock that Pryce used to love his Pokémon. Because he treated his Pokémon so coldly, and his favoring of the Ice-type, people began calling him "Icy Pryce". She, Brock, and Misty descend the cliff by a rope. Meanwhile, Ash and Pryce look for a way out and stumble upon an opening, which was revealed by earlier Totodile's Water Gun. Pryce spots an old anklet, which he says belonged to his Piloswine. Now at the bottom, Sheila explains that Pryce once had a Piloswine, that one day just left. Pryce elaborates to Ash, saying that he and Piloswine were once in a national tournament against a Magmar. He and Piloswine were both badly burned, as Pryce ran to protect it. One night, Piloswine just left the snowbound cottage they were recovering in, and Pryce never saw it again. Ever since then, Pryce stopped treating Pokémon as friends.
Pryce and Ash soon enter a cavern covered in a thin layer of ice. Ash sees a figure frozen in the ice. With a shock, Pryce realizes it is his Piloswine, which is holding herbs used to treat burns. Ash deduces that it got trapped after looking for herbs to help his friend. Pryce falls to his knees, and with tears trickling down his face he apologizes to his friend for leaving it behind. Ash then uses Cyndaquil's Flamethrower to thaw the ice and Pikachu's Thunder Shock to revive Piloswine. Piloswine still remembers Pryce, to the old man's delight. Pryce tells Piloswine to Rest up and explains to Ash that the move restores energy.
Sheila calls out for the lost duo, and Pryce emerges with his old friend Piloswine by his side once again. Sheila is also excited to see Piloswine. Team Rocket descends into the crevasse with their balloon and starts another battle. Pryce takes Arbok and Weezing head-on with Piloswine, and beats them both with a blast of Blizzard. Pikachu delivers a powerful Thunderbolt to send Team Rocket off, and everyone celebrates. Back at the Gym, Ash requests a Gym battle against Pryce, though he declines. Pryce admits that he and Piloswine need some rest, but he offers to battle Ash tomorrow. Ash accepts and looks forward to earning his seventh Johto League Badge.