Snake oil, it doesn't regenerate anything. True HDD defects never decrease again. And, if you see defects on modern HDDs it means the reserve space is actually already exhausted and the end nigh. However, it still has a purpose. If your drive has Pending sectors (C4), that's sectors the firmware has marked as possible defects, you can use this software (or the similar SpinRite) to force a Write on all sectors. This will cause the firmware to decide the fate for each Pending sector. In many cases, the sectors are actually good and returned to the normal pool, which is probably where the "regenerate" comes from.
Personally I want exactly the opposite of this. I want that a possible defect is marked as surely defective sector to be sure it's never used again. Who want to risk to loose a 10GB file, because has cheaped to recover 16kb of space one year earlier?
1/5/10 bad sector means nothing by theirself. It can be just an unlucky area that wasn't properly detected on quality control. HDD approaching the end of practical life, usually have dozens of bad sectors, and that number increases rapidly in matter of days. I have a Green WDC 2TB, from 2009 or so. It has a small number of defective sectors since 2015 or so. I use it duplicated using the great "drive pool" (a better/more modern solution than old Raid1), so I'm relaxed. But relaxed or not, the bad sectors are still the same as they were in 2015, although that disk has reached now 2100+ power cycles and 73000+ hours of uptime