How to get around Malus Darkblade unit replenishment penalty?

The Malus Darkblade of Dark Elves in Total War Warhammer II has a unique mechanic: every round he gets "possession points" - 2 if he is in the field, 1 if he is in a city. When he hits 10 points (or maybe even 9?) his armies stop regenerating after combat, even when they are in an owned city. Of course, he can drink an elixir that gives -10 points, but it's expensive and the price keeps rising after each purchase. This leads to the situation where I have to keep sacking cities just to afford the "fix", which greatly cripples my progress.

I've tried to give the wounded units to another general, but it seems that the penalty is global. I've heard, that you can, in theory, go around it by recruiting lots of Death Hags, which give regeneration bonus - is that true?

Following this reddit thread about replenishment it seems possible in theory:

• being in owned (or allied) region lets you replenish casualties in your army by 8% per turn. It's 8% of a single unit HP (240 HP per turn for a unit with 3000 max HP), and to simplify for units with multiple troops (in case there are 90 troops in unit) it's 0.08x90 = 7 replenished troops per turn.
• This gets updated by + 12% in a city
• Death Hag gives max +20 % (8% +12% from 3 upgrades)
• 10 points possession gives -50%
• Supernatural Tissue skill – +30% replenishment rate (lord’s army) - I think, this affects only Malus tho

So fully possessed, in a city with ST skill I should be at 0 (8+12+30-50) and each Hag should push me to a positive value - unless there are some hidden rules that I've missed?

TLDR

Most reliable method to negate Malus's penalty: Get both Lord's and Death Hag's replenishment boost, garrison in town. Done.

It is certainly possible to overcome the replenishment penalty of Malus's possession. Replenishment rate is affected by a lot of factors and you can easily find ways to boost it.

For this question I'll have a list of possible replenishment boost available to Hag Greaf(Malus's faction):

1. Death Hag - up to 20%
2. Garrison - 20% (Climate might reduce this)
3. Black Ark - 10% (Near sea only)
4. Sacrifice to Kain? - 20%
5. Growth build chain - up to 4%
6. Pasture build chain - up to 8% (certain provinces only)
7. Medicinal plant build chain - up to 12% (certain provinces only)
8. Lord's skill - Malus up to 45%, others up to 15% (All Dark Elves lord have Elven Healing which gives 15% replenishment at rank 3)
9. Items - ?% (This one will take some time to calculate but on the bright side, if you obtain any equipment that boost replenishment, you can pass it from one lord to another depending on whose army needs it more.)
10. Events - ?% (This will probably remain ? unless I can find all possible events and their effects but since it is almost random I wouldn't count on it to offset global penalties.)

I'll expand this list as I find more.

From the numbers I've gathered so far you can see that Malus himself will have no problem offsetting the penalty, other lords can almost do it just by having a Death Hag, the right skills and garrisoned in a town.

If you need significant replenishment, bringing a Black Ark nearby and perform the ritual Sacrifice to Kain will provide a 30% boost. Just take note that replenishment bonus from Black Ark and Death Hag only applies once, having one of each is enough.

But to also answer your secondary concerns of factors you missed, here are some common Negative replenishment rate factors:

1. Climate: when you try to expand into unsuitable climate you may have up to 15% penalty, offsetting the Lord's Elven healing skill.
2. Post Battle option: Releasing(Ransom I think is the word used for Dark Elves) captives from battles will result in temporary lower replenishment rate by about 10%
3. Events: This is most unpredictable, but you can always check the global effects on the top bar to see if any recent events is giving you replenishment penalty.
4. Hostile Heroes activity: Some heroes can cause your army to have lesser replenishment for a certain duration, this can be as high as 40% penalty.

On the side note, I wouldn't suggest letting Malus be permanently possessed, on top of the replenishment penalty there is also Loyalty penalty which is in my opinion, more problematic and harder to overcome. Fortunately you can take 2 elixir at once to cause a reverse chance to gain loyalty instead to counter it, but I wouldn't suggest pushing that limit since a single mistake might mean an entire army abandoning you.