In a fetus, there is high pulmonary vascular resistance and low pulmonary blood flow as the fetus does not use the lungs for oxygen transfer. Once the baby is born, the lungs are needed for oxygen transfer and need high blood flow which is encouraged by low pulmonary vascular resistance.
It can be associated with pulmonary hypertension. Because of this, the condition is also known as "persistent pulmonary hypertension of the newborn".
^1. Chambers CD, Hernandez-Diaz S, Van Marter LJ, et al. Selective serotonin-reuptake inhibitors and risk of persistent pulmonary hypertension of the newborn. N. Engl. J. Med. 2006;354(6):579-587. Available at: http://www.ncbi.nlm.nih.gov/pubmed/16467545