Well, instead of nesting the whole thing in an if statement, only have:
PHP Code:
if (!alive)
     setNextObject(); 
in your newObject function. You might get a case where one more enemy spawns...

What I'd recommend doing is:
Code:
nextObject.removeEventListener( TimerEvent.TIMER_COMPLETE, newObject);
Put this in the if statement when health is zero. (Place this where you wrote:
THIS IS WHERE I WANT IT TO GO TO NEXT FRAME AND STOP THE CODE FROM RUNNING.)

P.