Reversing progressive deafness is one of the many plausible goals for the field of regenerative medicine, and scientists have in recent years demonstrated a way to spur creation of hair cells in the ear through a form of gene therapy. Any method that can reliably generate new hair cells has the potential to reverse the common forms of deafness caused by loss of those cells, such as through damage or aging. Here's a popular science article on this latest advance:
Raphael's team first gave the guinea pigs antibiotics which destroyed their inner-ear hair cells. They then apparently repaired the damage by injecting them with genetically engineered adenoviruses. ... The therapy promotes the regrowth of crucial hair cells in the cochlea, the part of the inner ear which registers sound. After treatment, the researchers used sensory electrodes around the animals' heads to show that the auditory nerves of treated - but not untreated - animals were now registering sound. ... The experiment worked beyond expectation. "The recovery of hair cells brought the treated ears to between 50% and 80% of their original hearing thresholds," says Raphael. Even more surprising, the team found that the hair cells were created from cells lining the scala media which - according to biological orthodoxy - should not be able to turn into other cells.
And here is the paper:
To restore hearing, it is necessary to generate new functional hair cells. One potential way to regenerate hair cells is to induce a phenotypic transdifferentiation of nonsensory cells that remain in the deaf cochlea. Here we report that Atoh1, a gene also known as Math1 encoding a basic helix-loop-helix transcription factor and key regulator of hair cell development, induces regeneration of hair cells and substantially improves hearing thresholds in the mature deaf inner ear after delivery to nonsensory cells through adenovectors.
You'll notice that this is another application of transdifferentiation, an approach that changes a cell from one type directly to another type without going through the now standard process of first generating pluripotent cells, then differentiating them into the desired cell type. Thus transdifferentiation might prove to be a useful tool for in-situ biological repairs that require a small population of specific cells to be replaced or regenerated, such as the dopamine neurons lost in Parkinson's disease, for example, or beta cells in the pancreas.