This is a very tough problem to solve and I am not aware of any solution for this in realtime. If I needed to solve this I would start from this paper using SDF:
The SDF are very intensive in memory (e.g. PhysX had an implementation of this called PMeshes for a while, but dropped it again because of the high memory usage) so you would need to come up with some kind of compression. I heard there has been some good experience with low band SDF in the FX field recently, but I have no practical experience. In games you usually take much simpler approaches. Dennis gave a presentation on this at GDC here:
There are some good SDF libraries out there which might be a good start. The authors of the libraries might be good initial contacts as well:
HTH and good luck!