My observation over time is that the gap between current value and the "true" projection of a particular rating is one of the factors in progression. So a young player (with good makeup, good coaching, and all the other factors that go into development) who is 20 points away (for example) from his projection will appear to take bigger steps forward with each development cycle than he would if he were only, say, 5 points away. Which also explains why development appears to slow down over time. That, and age.
So while "past problems" can set a player back, it's not necessarily a done deal that he's ruined . . . but depending on how severely he was damaged, he may never completely recover all thosed missed development points. He may (or probably will) get some back, but not all.