Regenerative medicine holds the promise to coax cells in the body to create new tissue, which could become vessels and perhaps even entire organs. Dr. Anthony Atala’s vision for the technology is that it creates something else – a new manufacturing base in North Carolina.

During comments presented at the Emerging Issues Forum in Raleigh, Atala, director of the Wake Forest Institute for Regenerative Medicine, or WFIRM, floated the potential for North Carolina becoming a center for manufacturing human body parts.

If manufacturing body parts becomes commercially viable, one North Carolina company could have a key role in that new industry.

Tengion (OTC:TNGN), based in Winston-Salem, has been researching and developing regenerative medicine applications licensed from the WFIRM. The company’s lead technology would help bladder cancer patients who have had their bladders removed. Tengion has developed a way to use the patient’s own cells to generate new bladder tissue. That tissue is fashioned into a new conduit that functions to carry urine from the body. It’s not a new bladder. But it works a lot better than the current standard of care, which involves creating conduits from bowel tissue and can cause complications. A second Tengion program addressing patients with chronic kidney disease is still in preclinical development.

While Tengion has made progress in both regenerative medicine programs, it’s also had trouble financially supporting them. Tengion implemented a 2011 corporate restructuring that included layoffs and the consolidation of its operations in Winston-Salem. Even with those cash-saving moves, Tengion only had enough money to last through the third quarter of 2012.

The company got a lifeline last October with a $15 million investment from investors that included New Jersey-based biopharmaceutical giant Celgene (Nasdaq: CELG). The money was intended to support the urinary conduit and kidney programs. But even with new financing, Tengion still fell out of compliance with the Nasdaq and lost its stock listing.

Tengion originally planned to implant its neo-urinary conduit in up to 10 patients by the end of 2012. Tengion last month announced it had enrolled the seventh patient in the phase I study. Now the company expects to reach the 10 patient target by the end of the first quarter. Tengion also says it’s on track start clinical studies on its kidney program. The company filed an application with regulators in Sweden to start a phase I trial in up to five patients with chronic kidney disease. Tengion expects that trial to start in the second quarter.

Even with this progress it’s too early to to talk about Tengion becoming a body parts manufacturer. Food and Drug Administration approval is still uncertain and years away.

If Tengion’s technology gets that far, it would likely reach the regulatory finish line in the hands of another company. Celgene holds the right of first negotiation to buy or license Tengion’s neo-urinary conduit technology. But FDA approval would not only validate the regenerative medicine technology, it would also affirm the burgeoning sector building up around WFIRM’s base at Wake Forest Biotech Place.

One company becomes several.

As the cluster grows it adds function. And those functioning entities help the region and the state work in a brand new way. In a way, it’s a lot like regenerative medicine.

Editor’s note: Frank Vinluan is a business journalist with more than decade of experience covering technology and life sciences. Most recently he led the North Carolina bureau for online health care news startup MedCity News. Before joining MedCity, he was the beat reporter covering technology, biotechnology and energy for the Triangle Business Journal. Prior to moving to the Research Triangle in 2007 he held business reporting positions at The Des Moines Register and The Seattle Times.