Azalea is Orphen's foster sister and best friend—they grew up together in the same orphanage and enrolled at the Tower of Fangs as young magical prodigies. She's the one who actually taught him most of what he knows, giving him way more attention than the other students got. By all accounts, she was genuinely talented, probably one of the strongest sorcerers around.
But she had two sides to her personality. There's the warm, caring Azalea, and then there's the one Orphen describes as downright "scary." After getting rejected by someone she loved, something shifted. She became obsessed with her research and chasing more power, pouring everything into increasingly ambitious experiments. One of those experiments went catastrophically wrong and transformed her into Bloody August—literally named after the dragon that first emerged in August that year.
Note: This backstory is specific to the J.C. Staff anime adaptation and differs significantly from both the original novels and the remake.
Content compiled by AnimeList.moe from publicly available sources.