This situation is definitely one that requires you sell your bitcoins. Any life threatening situation which cannot be solved by the cash I have available would cause me to liquidate my Bitcoin holdings.

I see absolutely no reason why I should forget about Bitcoin. Having to empty my wallet at one time does not mean I cannot keep earning in Bitcoin and building my stash over again.

Even if this story isn't a lie, it doesn't require a forum thread, you only need to look out for your acquaintance and help out when you can.