Meanwhile, Alex was developing a serum likely to cure Caroline Wilson of the deadly virus she was suffering from. Although the serum required more tests, it was stolen by Caroline's desperate husband, Lionel Lockridge. When Caroline injected herself with the concoction, it seemed to cure her. Then, Gina, with the help of Keith Timmons, stole the remainder of Alex's serum and sold it to C.C. for bigs bucks. With C.C. planning to market the serum, Alex used the situation to his advantage. He faked positive test results for the formula, setting C.C. up to take the fall when several people died after being treated with the serum, including Caroline Wilson.

After this debacle, Alex seemingly turned out to be the father of Elena Nikolas (a.k.a. Eleanor Norris), who was plotting against the Capwell family. But Alex soon learned of Eleanor's discovery that she was actually C.C. and Pamela's daughter. Worried about Eleanor's evil actions, Alex did his best to stop her until she was killed one night. Cruz Castillo, the object of Eleanor's obsession, went on trial for the murder. During the trial, Alex was shocked when Pamela turned out to be alive and living in Santa Barbara. After his initial anger wore off, Alex told Pamela that he still loved her.

Following Elena's death, Alex engaged himself in suspicious activities like burning Elena's adress book. After a failed suicide attempt, Alex confessed that he had accidentally killed Elena when he tried to take a gun away from her. It was later revealed that Elena had actually killed herself. Then, realizing that Pamela still wanted C.C., Alex left town defeated.