Troubled insulin producer Bioton has informed the County Labor Office of its intention to implement mass layoffs.

Of its current staff of around 635, Bioton wants to make 170 redundant, a figure which amounts to almost 27 percent of its workforce. The first of these employees will get their walking papers this month.

According to Parkiet, the documentation sent to the Labor Office by Bioton noted that, “The need exists to rationalize and optimalize the organizational and employment structure of the company through the liquidation of some of the work positions.” According to the company, this will allow efficiency to be increased.

“While the size of the layoffs is surprising, showing as it does the scale of inefficiency in Bioton’s structure in Poland, at the same time it was to be expected after last [month’s] publication of a [new EBITDA] strategy. ... Therefore in our analysis we allowed for costs of zł.25 million associated with restructuring of the Polish entity, in which the costs of employees’ severance pay was included,” Paweł Burzyński, an analyst with brokerage DM BZW BK, told Parkiet.

He estimated, however, that the move could help Bioton improve its operational result by zł.11 million in 2010.

Bioton had a net loss of zł.19.7 million at the close of Q1 and recently announced its intention to sell off foreign assets.