Something seems wrong with those numbers, or the operations dummy. If I plug those numbers in for an Arsenal Merc, with no additional armour penetration above the 35% from the cylinder I get 216.3. It only hits for 207 though.

Edited version of your formula: 280 * (1-0.35 * (1 - (0.35 + 0))) = 216.3

That is if my assumption that these were what your numbers meant Proc Damage * (1-Boss Reduction * (1 - (Armour Pen + Additional Armour Pen)))