Varun and Sarah Sharma, from Huntingdon in Cambridgeshire county of England, were expecting their first child last year when the mum-to-be was prescribed acne drugs that are not suitable for pregnant women.
27-year-old Sarah was given isotretinoin, a potentially dangerous acne medication, by dermatologists at Peterborough City Hospital.
After 21 weeks of pregnancy, she delivered a stillborn baby, Indiya, at Hinchingbrooke Hospital back in January 2012. An autopsy confirmed the abnormalities were as a result of 'fetal isotretinoin syndrome', a side effect of the drug prescribed to her.
Sarah did not know she was pregnant when the drug was prescribed to her, as the hospital had said that a pregnancy test was negative.
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Peterborough City Hospital has since apologised for the error. Peterborough and Stamford Hospitals NHS Foundation Trust admitted that staff should have realised Sarah was in the early stages of pregnancy and that Indiya's death could have been prevented.
John Randall, medical director at the trust, has apologised for the trauma the family experienced.
The mother-to-be was told at her 20-week scan that the baby had such serious heart and nervous system abnormalities that she would not survive after birth, according to the couple's solicitors Irwin Mitchell.
"As a husband and a father, it was heartbreaking seeing my wife go through the pain of labour, knowing we would never get to take that baby home as parents should at the end of it. We were left with nothing but broken hearts and empty arms," said Varun.
The couple have received an undisclosed settlement from the trust and plan to donate some money to Hinchingbrooke Hospital in Cambridgeshire, which looked after the couple following the incident and where their four month old baby Asha was born.