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Are you in the barn with the village elder? If so, when he splits and turns into that creature it will give you enough time to run around and pick up supplies. (There is a ladder to the left of the entrance and you can find stuff up there). If you run around and dodge him he won't do as much damage, and then just periodically shoot your shotgun or rifle at him. Eventually he'll die, and you can get the eye from him to let you through that gate. What size attache case do you have? If you have to, dump the crappy handgun and get a better gun. I can't remember when I picked up the Blacktail, but I will say that an upgraded TMP really kicks ass. (The first stage one is wimpy, though). Whenever you can, upgrade your weapons. You can always backtrack to a merchant to do so.
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