Tobacco and Fetal Development

"Maternal smoking during pregnancy produces adverse effects for the fetus through several pathways. First, cigarette smoke interferes with normal placental function. As metabolites of cigarette smoke pass through the placenta from mother to fetus, they act as vasoconstrictors to reduce uterine blood flow by up to 38% [62]. The fetus is deprived of nutrients and oxygen, resulting in episodic fetal hypoxia-ischemia and malnutrition [63]. This is the basis for the fetal intrauterine growth retardation seen in many infants born to smoking mothers. Studies have shown that smoking is responsible for 20–30% of all infants of low birthweight, and that infants born to smoking mothers weigh an average 150–250 grams less than infants born to nonsmoking mothers [64].
"Second, the nicotine in cigarette smoke acts as a neuroteratogen that interferes with fetal development, specifically the developing nervous system [65]."

Source: 

Lester, Barry M.; Andreozzi, Lynne; Appiahm, Lindsey, "Substance use during pregnancy: time for policy to catch up with research," Harm Reduction Journal (London, United Kingdom: April 2004) Volume 1, Issue 5, p. 6.
http://www.harmreductionjourna...

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