When the Downside Belongs to Someone Else

Decisions made under uncertainty are often judged by their outcomes rather than by the information available at the time when they were made. Yet a successful outcome does not necessarily imply a sound decision, just as a failed outcome does not necessarily imply a poor one. Courts frequently distinguish between judging a decision with hindsight and assessing what a reasonable person could have concluded given the circumstances at the time. The same distinction is equally important in business, science, and public policy.

A recent LinkedIn post reminded me of that distinction. The post drew on Louis Pasteur’s treatment of Joseph Meister in 1885 to illustrate a broader point about risk, uncertainty, and decision-making. The argument runs roughly as follows: Pasteur acted because the downside was already maximised. Without treatment, the boy would die. The vaccine had shown promise; therefore, the rational decision was to intervene. The author concluded that ‘many of the business decisions [he] takes have the same structure’. The lesson drawn was that sometimes the risk of inaction is greater than the risk of action.¹

At first glance, this seems like a compelling argument. Anyone who has built a company, invested capital, or served on a board of directors has encountered situations where the downside of inaction appears greater than the downside of acting. There are moments when difficult decisions must be made despite incomplete information. The fact that Pasteur ultimately achieved a remarkable scientific breakthrough makes the story all the more persuasive.

However, the more I examined the historical record, the less convinced I became that the circumstances were as clear-cut as the analogy implies.

A Closer Look at History

The historical account underlying the analogy of Pasteur’s development of the first rabies vaccine is more complex than is often presented. In 1878, Pasteur reportedly told his family never to allow anyone access to his private laboratory notebooks. It was not until 1964 that his last surviving grandson donated a collection of more than one hundred volumes to the Bibliothèque Nationale in Paris. A decade later, in the mid-70s, a few select historians were granted access to the notebooks.²

Professor Gerald Geison, who was a professor in the history department and the Program in History of Science at Princeton University, studied more than 100 laboratory notebooks.³ After almost two decades of research, Geison ‘discovered serious discrepancies between the notebooks and the scientific accounts that Pasteur published.’ Some of these include:

1. Pasteur claimed he had made 50 dogs immune to rabies before giving the vaccine to the first human. However, Geison’s review of Pasteur’s notebooks, a century later, revealed that Pasteur had tested other vaccines on only a few dogs, and only before they were infected with rabies.³ Moreover, some historians have argued that the specific vaccine regimen used on Meister had not previously been tested in animals.^{2, 4}
2. The post further states that Pasteur had never tried the vaccine on a human. However, Pasteur’s notebooks reveal that he had already used another variation of a rabies vaccine on two other human subjects before trialling it in a symptomatic animal.² One of them, a young girl, quickly died. The other survived.² In neither case did Pasteur publicly disclose the treatments when later presenting the development of the rabies vaccine.⁴
3. The two boys (one of whom was Meister) who came to Pasteur in 1885 had been bitten by rabid dogs. Importantly, neither boy was symptomatic when they presented to Pasteur. The assertion that death was inevitable was therefore not a conclusion that could be reached with certainty at the time. Pasteur injected the boys with the untried vaccine. Both boys survived, and neither developed rabies. As several historians have noted, however, survival alone could not establish efficacy because not everyone bitten by a rabid animal goes on to develop the disease.⁴

These findings do not mean Pasteur was wrong about the vaccine. History ultimately judged the outcome as a remarkable success. But it does mean that the decision was taken under greater uncertainty than the simplified version of the story often acknowledges.

The Parallel to Macchiarini

Reading these accounts, it is difficult not to think of the more recent case of Paolo Macchiarini.⁹ Macchiarini was an internationally celebrated surgeon who claimed to pioneer regenerative medicine by implanting synthetic tracheas seeded with patients’ stem cells. The procedures were presented as breakthrough treatments for patients with otherwise limited options, and they attracted significant attention from leading institutions, including the Karolinska Institutet in Sweden.⁵

The scandal emerged after whistleblowing reports combined with investigative journalism. Between 2011 and 2013, Macchiarini performed transplantations of synthetic tracheas on eight patients (three in Sweden,⁷ and five in Russia and the US). Seven of the patients later died. The eighth patient had the implant removed and survived.⁸

Critics alleged that the procedures had not been adequately tested, that the risks had not been properly established, and that published research presented patient outcomes more favourably than was justified by the underlying evidence. Investigations subsequently found research misconduct in several publications and identified serious failures in oversight and governance.^{5, 6} In 2023, the Svea Court of Appeal convicted Macchiarini of aggravated assault for the deaths of the three Swedish patients.⁷ 

 ‘A successful outcome does not necessarily imply a sound decision, just as a failed outcome does not necessarily imply a poor one’ 

Risk is Rarely Binary

The cases of Pasteur and Macchiarini are obviously different and should not be conflated. Pasteur’s work ultimately led to one of the greatest medical breakthroughs in history. Macchiarini’s work, however, ended in tragedy and criminal conviction. Yet one uncomfortable question remains: if Pasteur's experiment had failed, and Joseph Meister had died, would history remember him differently?

Viewing the two cases through the lens of hindsight risks obscuring what is perhaps the most relevant similarity. In both instances, highly uncertain interventions were justified by reference to a potentially transformative outcome. The implicit argument was that the opportunity was so significant that taking extraordinary risks could be justified. Whether that reasoning was ultimately vindicated is a separate question from whether it was sound at the time.

The idea that ‘the downside was already maximised’¹ assumes that death was the only relevant outcome. That is rarely true. A patient may survive, die, suffer severe complications, experience a loss of quality of life, or undergo an extended period of suffering before death. Risk is rarely binary.

The False Choice Between Action and Inaction

The argument underlying the entrepreneur’s use of the Pasteur analogy implicitly assumes a choice between action and inaction: administer the vaccine or do nothing. Yet, difficult decisions rarely present themselves in such binary terms. The more relevant question is often not whether to act, but how to act.

Based on the historical accounts, Pasteur was not necessarily choosing between administering the vaccine and abandoning Joseph Meister. Other courses of action may have been available, including gathering additional evidence, seeking further corroboration, or conducting testing before proceeding.

The same principle applies in business. When organisations face severe financial distress, leaders sometimes frame the situation as a choice between a dramatic intervention and collapse. In reality, most cases involve a range of alternatives, each with different risks, costs, and ethical implications. Restructuring, downsizing, an orderly wind-down, a sale of the business, or external administration may all represent alternatives that may limit losses and protect stakeholders.

Once decision-makers become convinced that the downside has already been maximised, they may stop searching for alternatives. At that point, the discussion shifts from identifying the best course of action to justifying a particular one.

The Moral Hazard of ‘Nothing Left to Lose’

When individuals or organisations believe they are facing an existential threat, it is easy to resort to statements such as ‘we have nothing left to lose.’ Yet the downside is rarely exhausted. Investors may still have capital at risk. Employees still depend on their salaries. Suppliers, customers, lenders, and other stakeholders continue to have legitimate interests that deserve protection and, in many jurisdictions, are legally protected.

Perhaps the most important aspect of the Pasteur story is not whether the decision was courageous, but who bore its consequences. Pasteur made the decision. Joseph Meister received the treatment.

Likewise, entrepreneurs often make decisions using capital risked by shareholders and creditors. Boards make decisions that affect employees, creditors, customers, and other stakeholders. The decision-maker is rarely the only person carrying the risk.

When decision-makers claim there is nothing left to lose, they have often either failed to identify all of the downside risks or shifted those risks onto someone else. The question is therefore not whether the upside justifies the risk. The question is whether we have correctly identified the downside risks, and whether the people carrying those risks are the same people making the decision.

Sources

1. Saeid Esmaeilzadeh, ‘Den 6 juli 1885 gjorde Louis Pasteur något som borde ha kostat honom karriären' (LinkedIn, 6 July 2026) accessed 6 July 2026.
2. Christopher Anderson, ‘Pasteur Notebooks Reveal Deception’ (1993) 259 Science 1117.
3. Susan Katz Miller, ‘The Daring and Devious Father of Vaccines’ (New Scientist, 20 February 1993) accessed 6 July 2026.
4. John Harley Warner, ‘Review of The Private Science of Louis Pasteur by Gerald L Geison’ (1996) 70(4) Bulletin of the History of Medicine 718 accessed 6 July 2026.
5. ‘The Macchiarini Case: Timeline’ (Karolinska Institutet, 14 October 2025) accessed 6 July 2026.
6. Arushi Roy Chowdhury, ‘The Surgeon Who Tried to Build New Organs: How Paolo Macchiarini’s Medical Miracle Became a Global Scandal’ (Med Bound Times, 29 May 2026) accessed 6 July 2026.
7. Svea hovrätt (Svea Court of Appeal), B 9036-22, judgment of 21 June 2023.
8. Erik Wikén, ‘Detta har hänt: Skandalen kring Paolo Macchiarini’ (SVT, 27 April 2022) accessed 6 July 2026.
9. ‘The Paolo Macchiarini Case’ (Karolinska University Hospital) accessed 6 July 2026.