Level up some more I would say. If you keep losing then leveling is the best option. Maybe get about 6 or 7 more levels and if that dosen't work then keep leveling until you can beat him (although becareful because if you level too much and go to level 99 then he get's a added boss in power)

Also get more healing materia equipped. Especially with all, it'll help you a lot to have at least 2 or maybe everyone with restore and life materia. Also time materia can help, hasting everyoen with regan can really be nasty for sephiroth.